Among other attributes, the Betaproteobacterial genus Azoarcus has biotechnological importance for plant growth-promotion and remediation of petroleum waste-polluted water and soils. It comprises at least two phylogenetically distinct groups. The plant-associated group includes strains that are isolated from the rhizosphere or root interior of the C4 plant Kallar Grass, but also strains from soil and/or water; all are considered to be obligate aerobes and all are diazotrophic. The other group (now partly incorporated into the new genus Aromatoleum) comprises a diverse range of species and strains that live in water or soil that is contaminated with petroleum and/or aromatic compounds; all are facultative or obligate anaerobes. Some are diazotrophs. A comparative genome analysis of 32 genomes from 30 Azoarcus-Aromatoleum strains was performed in order to delineate generic boundaries more precisely than the single gene, 16S rRNA, that has been commonly used in bacterial taxonomy. The origin of diazotrophy in Azoarcus-Aromatoleum was also investigated by comparing full-length sequences of nif genes, and by physiological measurements of nitrogenase activity using the acetylene reduction assay. Based on average nucleotide identity (ANI) and whole genome analyses, three major groups could be discerned: (i) Azoarcus comprising Az. communis, Az. indigens and Az. olearius, and two unnamed species complexes, (ii) Aromatoleum Group 1 comprising Ar. anaerobium, Ar. aromaticum, Ar. bremense, and Ar. buckelii, and (iii) Aromatoleum Group 2 comprising Ar. diolicum, Ar. evansii, Ar. petrolei, Ar. toluclasticum, Ar. tolulyticum, Ar. toluolicum, and Ar. toluvorans. Single strain lineages such as Azoarcus sp. KH32C, Az. pumilus, and Az. taiwanensis were also revealed. Full length sequences of nif-cluster genes revealed two groups of diazotrophs in Azoarcus-Aromatoleum with nif being derived from Dechloromonas in Azoarcus sensu stricto (and two Thauera strains) and from Azospira in Aromatoleum Group 2. Diazotrophy was confirmed in several strains, and for the first time in Az. communis LMG5514, Azoarcus sp. TTM-91 and Ar. toluolicum TT. In terms of ecology, with the exception of a few plant-associated strains in Azoarcus (s.s.), across the group, most strains/species are found in soil and water (often contaminated with petroleum or related aromatic compounds), sewage sludge, and seawater. The possession of nar, nap, nir, nor, and nos genes by most Azoarcus-Aromatoleum strains suggests that they have the potential to derive energy through anaerobic nitrate respiration, so this ability cannot be usefully used as a phenotypic marker to distinguish genera. However, the possession of bzd genes indicating the ability to degrade benzoate anaerobically plus the type of diazotrophy (aerobic vs. anaerobic) could, after confirmation of their functionality, be considered as distinguishing phenotypes in any new generic delineations. The taxonomy of the Azoarcus-Aromatoleum group should be revisited; retaining the generic name Azoarcus for its entirety, or creating additional genera are both possible outcomes.