Freshwater annelids are globally widespread in aquatic ecosystems, but their diversity is severely underestimated. Obvious morphological features to define taxa are sparse, and molecular phylogenetic analyses regularly discover cryptic diversity within taxa. Despite considerable phylogenetic work on certain clades, many groups of freshwater annelids remain poorly understood. Included among these are water nymph worms of the genus Chaetogaster (Clitellata: Tubificida: Naididae: Naidinae). These worms have diverged from the detritivorous diet of most oligochaetes to become more predatory and exist as omnivores, generalist predators, parasites, or symbionts on other invertebrates. Despite their unusual trophic ecology, the true diversity of Chaetogaster and the phylogenetic relationships within the genus are uncertain. Only three species are commonly referenced in the literature (Chaetogaster diaphanus, Chaetogaster limnaei, and Chaetogaster diastrophus), but additional species have been described and prior molecular data suggests that there is cryptic diversity within named species. To clarify the phylogenetic diversity of Chaetogaster, we generated the first molecular phylogeny of the genus using mitochondrial and nuclear sequence data from 128 worms collected primarily across North America and Europe. Our phylogenetic analyses suggest that the three commonly referenced species are a complex of 24 mostly cryptic species. In our dataset, Chaetogaster “diaphanus” is represented by two species, C. “limnaei” is represented by three species, and C. “diastrophus” is represented by 19 species. North American and European sequences are largely interspersed across the phylogeny, with four pairs of clades involving distinct North American and European sister groupings. Overall, our study demonstrates that the species diversity of Chaetogaster has been underestimated and that carnivory has evolved at least twice in the genus. Chaetogaster is being used as a model for symbiotic evolution and the loss of regenerative ability, and our study indicates that researchers must be careful to identify which species of Chaetogaster they are working with in future studies.