The iron-sulfur (2Fe-2S) binding motif CDGSH appears in many important plant and animal proteins that regulate iron and reactive oxygen metabolism. In human it is found in CISD1-3 proteins involved in diabetes, obesity, cancer, aging, cardiovascular disease and neurodegeneration. Despite the important biological role of the CDGSH domain, its origin, evolution and diversification, are largely unknown. Here, we report that: (1) the CDGSH domain appeared early in evolution, perhaps linked to the heavy use of iron-sulfur driven metabolism by early organisms; (2) a CISD3-like protein with two CDGSH domains on the same polypeptide appears to represent the ancient archetype of CDGSH proteins; (3) the origin of the human CISD3 protein is linked to the mitochondrial endosymbiotic event; (4) the CISD1/2 type proteins that contain only one CDGSH domain, but function as homodimers, originated after the divergence of bacteria and archaea/eukaryotes from their common ancestor; and (5) the human CISD1 and CISD2 proteins diverged about 650–720 million years ago, and CISD3 and CISD1/2 share their descent from an ancestral CISD about 1–1.1 billion years ago. Our findings reveal that the CDGSH domain is ancient in its origin and shed light on the complex evolutionary path of modern CDGSH proteins.