The presence of Supressor of variegation-Enhanser of zeste-Trithorax (SET) domain genes in bacteria is a current paradigm for lateral genetic exchange between eukaryotes and prokaryotes. Because a major function of SET domain proteins is the chemical modification of chromatin and bacteria do not have chromatin, there is no apparent functional requirement for the existence of bacterial SET domain genes. Consequently, their finding in only a small fraction of pathogenic and symbiotic bacteria was taken as evidence that bacteria have obtained the SET domain genes from their hosts. Furthermore, it was proposed that the products of the genes would, most likely, be involved in bacteria-host interactions. The broadened scope of sequenced bacterial genomes to include also free-living and environmental species provided a larger sample to analyze the bacterial SET domain genes. By phylogenetic analysis, examination of individual chromosomal regions for signs of insertion, and evaluating the chromosomal versus SET domain genes' GC contents, we provide evidence that SET domain genes have existed in the bacterial domain of life independently of eukaryotes. The bacterial genes have undergone an evolution of their own unconnected to the evolution of the eukaryotic SET domain genes. Initial finding of SET domain genes in predominantly pathogenic and symbiotic bacteria resulted, most probably, from a biased sample. However, a lateral transfer of SET domain genes may have occurred between some bacteria and a family of Archaea. A model for the evolution and distribution of SET domain genes in bacteria is proposed.