Why are certain bacterial genomes so small and compact? The adaptive genome streamlining hypothesis posits that selection acts to reduce genome size because of themetabolic burden of replicating DNA. To reveal the impact of genome streamlining on cellular traits, we reduced the Escherichia coli genome by up to 20% by deleting regions which have been repeatedly subjects of horizontal transfer in nature. Unexpectedly, horizontally transferred genes not only confer utilization of specific nutrients and elevate tolerance to stresses, but also allow efficient usage of resources to build new cells, and hence influence fitness in routine and stressful environments alike. Genome reduction affected fitness not only by gene loss, but also by inductio...