The remarkable phenotypic diversity between and within species represents one of the most salient patterns across the Tree of Life. Why some clades exhibit low species diversity and morphological stasis for much of their evolutionary history whereas others have diversified into numerous species and morphological forms? And similarly, why do some populations exhibit greater intraspecific variation compared to other populations? In this dissertation, I used the carnivoran clade Musteloidea (badgers, minks, otters, raccoons, red panda, skunks, weasels) to examine how phenotypic variation between and within musteloid species contribute to their overall biological diversity. In my first two chapters (Chapters 1 and 2), I used a variety of phylogenetic comparative methods and osteological specimens to reveal that musteloids exhibited increased species richness due to evolutionary shifts to more elongate bodies. This morphological innovation potentially allowed these elongate musteloids to exploit novel habitats and prey associated with the climatic changes of the Mid-Miocone Climate Transition. In Chapter 3, I used 3D geometric morphometrics of musteloid crania and found that dietary divergence rather than sexual selection was a greater factor in maintaining cranial sexual dimorphism in musteloids. These results provide evidence that sexual selection is not always the primary force that maintains sexual dimorphism and demonstrate the importance of diet in reducing intraspecific competition for resources as an important mechanism that maintains the evolution of sexual dimorphism in extant musteloids. In my last two chapters (Chapters 4 and 5), I used 2D geometric morphometric and gross dissection approaches to quantify the size and shape of southern sea otter skulls and estimated their bite force. I found significant sexual dimorphism in adult sea otter skulls and bite force that arose through differences in developmental and growth rates and duration of the craniomandibular morphology. I postulate that males are selected to attain mature crania faster to presumably reach adult biting ability sooner, gaining a competitive advantage in obtaining food and in male–male agonistic interactions. Overall, my dissertation demonstrates how phenotypic variation can lead to increased diversification within certain clades as well as increases in potential competitive advantages within a single population.