Multicellularity is the premier example of a major evolutionary transition in individuality and was a foundational event in the evolution of macroscopic biodiversity. The volvocine chlorophyte lineage is well suited for studying this process. Extant members span unicellular, simple colonial, and obligate multicellular taxa with germ-soma differentiation. Here, we report the nuclear genome sequence of one of the most morphologically simple organisms in this lineage—the 4-celled colonial Tetrabaena socialis and compare this to the three other complete volvocine nuclear genomes. Using conservative estimates of gene family expansions a minimal set of expanded gene families was identified that associate with the origin of multicellularity. These families are rich in genes related to developmental processes. A subset of these families is lineage specific, which suggests that at a genomic level the evolution of multicellularity also includes lineage-specific molecular developments. Multiple points of evidence associate modifications to the ubiquitin proteasomal pathway (UPP) with the beginning of coloniality. Genes undergoing positive or accelerating selection in the multicellular volvocines were found to be enriched in components of the UPP and gene families gained at the origin of multicellularity include components of the UPP. A defining feature of colonial/multicellular life cycles is the genetic control of cell number. The genomic data presented here, which includes diversification of cell cycle genes and modifications to the UPP, align the genetic components with the evolution of this trait.