ABSTRACTSpiroplasmas are helical and motile members of a cell wall-less eubacterial group calledMollicutes. Although all spiroplasmas are associated with arthropods, they exhibit great diversity with respect to both their modes of transmission and their effects on their hosts; ranging from horizontally transmitted pathogens and commensals to endosymbionts that are transmitted transovarially (i.e., from mother to offspring). Here we provide the first genome sequence, along with proteomic validation, of an endosymbiotic inheritedSpiroplasmabacterium, theSpiroplasma poulsoniiMSRO strain harbored byDrosophila melanogaster. Comparison of the genome content ofS. poulsoniiwith that of horizontally transmitted spiroplasmas indicates thatS. poulsoniihas lost many metabolic pathways and transporters, demonstrating a high level of interdependence with its insect host. Consistent with genome analysis, experimental studies showed thatS. poulsoniimetabolizes glucose but not trehalose. Notably, trehalose is more abundant than glucose inDrosophilahemolymph, and the inability to metabolize trehalose may preventS. poulsoniifrom overproliferating. Our study identifies putative virulence genes, notably, those for a chitinase, the H2O2-producing glycerol-3-phosphate oxidase, and enzymes involved in the synthesis of the eukaryote-toxic lipid cardiolipin.S. poulsoniialso expresses on the cell membrane one functional adhesion-related protein and two divergent spiralin proteins that have been implicated in insect cell invasion in other spiroplasmas. These lipoproteins may be involved in the colonization of theDrosophilagerm line, ensuringS. poulsoniivertical transmission. TheS. poulsoniigenome is a valuable resource to explore the mechanisms of male killing and symbiont-mediated protection, two cardinal features of many facultative endosymbionts.IMPORTANCEMost insect species, including important disease vectors and crop pests, harbor vertically transmitted endosymbiotic bacteria. These endosymbionts play key roles in their hosts’ fitness, including protecting them against natural enemies and manipulating their reproduction in ways that increase the frequency of symbiont infection. Little is known about the molecular mechanisms that underlie these processes. Here, we provide the first genome draft of a vertically transmitted male-killingSpiroplasmabacterium, theS. poulsoniiMSRO strain harbored byD. melanogaster. Analysis of theS. poulsoniigenome was complemented by proteomics andex vivometabolic experiments. Our results indicate thatS. poulsoniihas reduced metabolic capabilities and expresses divergent membrane lipoproteins and potential virulence factors that likely participate inSpiroplasma-host interactions. This work fills a gap in our knowledge of insect endosymbionts and provides tools with which to decipher the interaction betweenSpiroplasmabacteria and their well-characterized hostD. melanogaster, which is emerging as a model of endosymbiosis.