DNA replication is central to all extant cellular organisms. There are substantial functional similarities between the bacterial and the archaeal/eukaryotic replication machineries, including but not limited to defined origins, replication bidirectionality, RNA primers and leading and lagging strand synthesis. However, several core components of the bacterial replication machinery are unrelated or only distantly related to the functionally equivalent components of the archaeal/eukaryotic replication apparatus. This is in sharp contrast to the principal proteins involved in transcription and translation, which are highly conserved in all divisions of life. We performed detailed sequence comparisons of the proteins that fulfill indispensable functions in DNA replication and classified them into four main categories with respect to the conservation in bacteria and archaea/eukaryotes: (i) non-homologous, such as replicative polymerases and primases; (ii) containing homologous domains but apparently non-orthologous and conceivably independently recruited to function in replication, such as the principal replicative helicases or proofreading exonucleases; (iii) apparently orthologous but poorly conserved, such as the sliding clamp proteins or DNA ligases; (iv) orthologous and highly conserved, such as clamp-loader ATPases or 5'-->3' exonucleases (FLAP nucleases). The universal conservation of some components of the DNA replication machinery and enzymes for DNA precursor biosynthesis but not the principal DNA polymerases suggests that the last common ancestor (LCA) of all modern cellular life forms possessed DNA but did not replicate it the way extant cells do. We propose that the LCA had a genetic system that contained both RNA and DNA, with the latter being produced by reverse transcription. Consequently, the modern-type system for double-stranded DNA replication likely evolved independently in the bacterial and archaeal/eukaryotic lineages.