The copepod Tigriopus californicus shows extensive population divergence and is becoming a model for understanding allopatric differentiation and the early stages of speciation. Here, we report a high-quality reference genome for one population (~190 megabases across 12 scaffolds, and ~15,500 protein-coding genes). Comparison with other arthropods reveals 2,526 genes presumed to be specific to T. californicus, with an apparent proliferation of genes involved in ion transport and receptor activity. Beyond the reference population, we report re-sequenced genomes of seven additional populations, spanning the continuum of reproductive isolation. Populations show extreme mitochondrial DNA divergence, with higher levels of amino acid differentiation than observed in other taxa. Across the nuclear genome, we find elevated protein evolutionary rates and positive selection in genes predicted to interact with mitochondrial DNA and the proteins and RNA it encodes in multiple pathways. Together, these results support the hypothesis that rapid mitochondrial evolution drives compensatory nuclear evolution within isolated populations, thereby providing a potentially important mechanism for causing intrinsic reproductive isolation.