The major difference between viruses and plasmids is the mechanism of transferring their genomic information between host cells. Here, we describe the archaeal plasmid pR1SE from an Antarctic species of haloarchaea that transfers via a mechanism similar to a virus. pR1SE encodes proteins that are found in regularly shaped membrane vesicles, and the vesicles enclose the plasmid DNA. The released vesicles are capable of infecting a plasmid-free strain, which then gains the ability to produce plasmid-containing vesicles. pR1SE can integrate and replicate as part of the host genome, resolve out with fragments of host DNA incorporated or portions of the plasmid left behind, form vesicles and transfer to new hosts. The pR1SE mechanism of transfer of DNA could represent the predecessor of a strategy used by viruses to pass on their genomic DNA and fulfil roles in gene exchange, supporting a strong evolutionary connection between plasmids and viruses.