The core properties of microbial genomes, including GC content and genome size, are known to vary widely among different bacteria and archaea 1,2 . Several hypotheses have been proposed to explain this genomic variability, but the fundamental drivers that shape bacterial and archaeal genomic properties remain uncertain 3-7 . Here, we report the existence of a sharp genomic transition zone below the photic zone, where bacterial and archaeal genomes and proteomes undergo a community-wide punctuated shift. Across a narrow range of increasing depth of just tens of metres, diverse microbial clades trend towards larger genome size, higher genomic GC content, and proteins with higher nitrogen but lower carbon content. These community-wide changes in genome features appear to be driven by gradients in the surrounding environmental energy and nutrient fields. Collectively, our data support hypotheses invoking nutrient limitation as a central driver in the evolution of core bacterial and archaeal genomic and proteomic properties.