A growing literature has documented that stressful conditions can facilitate evolutionary change in populations. However, this facilitation of evolution in situations of stress concentrates on how rates of adaptive change track increasing rates of environmental alteration. A neglected aspect of stress in evolution is its creative role related to the origin of new organismal features (i.e., origin of novel cell types and characters). These novelties exhibit a key distinguishing feature: they have a systematic relationship with the stressors experienced in the ancestral population. The new trait is a specific and permanent compensator that has been co-opted for particular conditions of stress. Standard models focus on how populations “fight” stress generally through adaptive modifications of existing characters (stress-induced evolutionary adaptation), rather than how populations “fix” particular stressors through the origin of altogether new characters (stress-induced evolutionary innovation). Using multiple examples from different developmental processes, such as soma-germline differentiation in Volvocine algae, cAMP signaling for spore formation in slime molds, decidual cell type origination in placental mammals, and dorsal closure morphogenesis in fruit flies, we build a cumulative case for stress-induced evolutionary innovation via co-option of stress regulatory networks across eukaryotic taxa. We argue that this distinctive mode of evolution has been more influential in the evolutionary process than biologists have previously appreciated and points to new explanatory principles and a research program of comparative and experimental work to further study the creative role of stress in evolution.