High affinity nitrate assimilation genes in fungi occur in a cluster (fHANT-AC) that can be coordinately regulated. The clustered genes include nrt2, which codes for a high affinity nitrate transporter; euknr, which codes for nitrate reductase; and NAD(P)H-nir, which codes for nitrite reductase. Homologs of genes in the fHANT-AC occur in other eukaryotes and prokaryotes, but they have only been found clustered in the oomycete Phytophthora (heterokonts). We performed independent and concatenated phylogenetic analyses of homologs of all three genes in the fHANT-AC. Phylogenetic analyses limited to fungal sequences suggest that the fHANT-AC has been transferred horizontally from a basidiomycete (mushrooms and smuts) to an ancestor of the ascomycetous mold Trichoderma reesei. Phylogenetic analyses of sequences from diverse eukaryotes and eubacteria, and cluster structure, are consistent with a hypothesis that the fHANT-AC was assembled in a lineage leading to the oomycetes and was subsequently transferred to the Dikarya (Ascomycota+Basidiomycota), which is a derived fungal clade that includes the vast majority of terrestrial fungi. We propose that the acquisition of high affinity nitrate assimilation contributed to the success of Dikarya on land by allowing exploitation of nitrate in aerobic soils, and the subsequent transfer of a complete assimilation cluster improved the fitness of T. reesei in a new niche. Horizontal transmission of this cluster of functionally integrated genes supports the "selfish operon" hypothesis for maintenance of gene clusters.