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Background  Transposable elements are major evolutionary forces which can cause new genome structure and species diversification. The role of transposable elements in the expansion of nucleotide-binding and leucine-rich-repeat proteins (NLRs), the major disease-resistance gene families, has been unexplored in plants.    Results  We report two high-quality de novo genomes ( Capsicum baccatum  and  C. chinense ) and an improved reference genome ( C. annuum ) for peppers. Dynamic genome rearrangements involving translocations among chromosomes 3, 5, and 9 were detected in comparison between  C. baccatum  and the two other peppers. The amplification of  athila  LTR-retrotransposons, members of the  gypsy  superfamily, led to genome expansion in  C. baccatum . In-depth genome-wide comparison of genes and repeats unveiled that the copy numbers of NLRs were greatly increased by LTR-retrotransposon-mediated retroduplication. Moreover, retroduplicated NLRs are abundant across the angiosperms and, in most cases, are lineage-specific.    Conclusions  Our study reveals that retroduplication has played key roles for the massive emergence of NLR genes including functional disease-resistance genes in pepper plants.    Electronic supplementary material  The online version of this article (doi:10.1186/s13059-017-1341-9) contains supplementary material, which is available to authorized users.

New reference genome sequences of hot pepper reveal the massive evolution of plant disease-resistance genes by retroduplication