Rapid diversifications of plants are primarily documented and studied in angiosperms, which are perceived as evolutionarily dynamic. Recent studies have, however, revealed that bryophytes have also undergone periods of rapid radiation. The speciose family Funariaceae, including the model taxon Physcomitrella patens, is one such lineage. Here, we infer relationships among major lineages within the Entosthodon-Physcomitrium complex from virtually complete organellar exomes (i.e., 123 genes) obtained through high throughput sequencing of genomic libraries enriched in these loci via targeted locus capture. Based on these extensive exonic data we (1) reconstructed a robust backbone topology of the Funariaceae, (2) confirmed the monophyly of Funaria and the polyphyly of Entosthodon, Physcomitrella, and Physcomitrium, and (3) argue for the occurrence of a rapid radiation within the Entosthodon-Physcomitrium complex that began 28 mya and gave rise more than half of the species diversity of the family. This diversification may have been triggered by a whole genome duplication and coincides with global Eocene cooling that continued through the Oligocene and Miocene. The Funariaceae join a growing list of bryophyte lineages whose history is marked by at least one burst of diversification, and our study thereby strengthens the view that bryophytes are evolutionarily dynamic lineages and that patterns and processes characterizing the evolution of angiosperms may be universal among land plants.