Patterns of sequence divergence in about 1 kb of mitochondrial DNA coding for two genes (16s rRNA and cytochrome oxidase I, COI) were analysed in 13 populations of the fairy shrimp Tanymastix stagnalis from Norway, Germany, France, Italy (northern and central Italy plus insular populations from Sardinia and the Tuscan Archipelago) and Spain, and in one presumed population of Tanymastix stellae from Corsica. The latter species was originally known only from a single locality in Sardinia, which has been destroyed by urbanization; the Corsican population was referred to T. stellae by some French authors on the basis of the collection of several cysts from mud. mtDNA data revealed a very low level of genetic divergence between the presumed population of T. stellae and the other T. stagnalis populations included in the study. Our genetic findings do not support the presence of T. stellae in Corsica and are in line with previous SEM studies revealing that all species belonging to the genus Tanymastix produce cysts with identical morphology. The results indicate complex phylogeographic relationships and pronounced genetic differentiation among T. stagnalis populations. The islands of Corsica and Sardinia on the one hand and the island of Capraia (Tuscan Archipelago) on the other were probably colonized independently at different times. Genetic relationships among continental populations do not follow a clear geographical trend, indicating that geographical distance is not the main force shaping the pattern of genetic structuring of the species. Stochastic factors such as multiple and independent founder events probably contributed to the striking pattern of genetic differentiation along with subsequent local adaptation. These results agree with previously published molecular work on several groups of aquatic organisms and further support the high potential for dispersal–low gene flow paradox shown by a large array of animals living in lentic habitats.