Salinity represents a critical environmental factor for all aquatic organisms, including fishes. Environments of stable salinity are inhabited by stenohaline fishes having narrow salinity tolerance ranges. Environments of variable salinity are inhabited by euryhaline fishes having wide salinity tolerance ranges. Euryhaline fishes harbor mechanisms that control dynamic changes in osmoregulatory strategy from active salt absorption to salt secretion and from water excretion to water retention. These mechanisms of dynamic control of osmoregulatory strategy include the ability to perceive changes in environmental salinity that perturb body water and salt homeostasis (osmosensing), signaling networks that encode information about the direction and magnitude of salinity change, and epithelial transport and permeability effectors. These mechanisms of euryhalinity likely arose by mosaic evolution involving ancestral and derived protein functions. Most proteins necessary for euryhalinity are also critical for other biological functions and are preserved even in stenohaline fish. Only a few proteins have evolved functions specific to euryhaline fish and they may vary in different fish taxa because of multiple independent phylogenetic origins of euryhalinity in fish. Moreover, proteins involved in combinatorial osmosensing are likely interchangeable. Most euryhaline fishes have an upper salinity tolerance limit of approximately 2× seawater (60 g kg−1). However, some species tolerate up to 130 g kg−1 salinity and they may be able to do so by switching their adaptive strategy when the salinity exceeds 60 g kg−1. The superior salinity stress tolerance of euryhaline fishes represents an evolutionary advantage favoring their expansion and adaptive radiation in a climate of rapidly changing and pulsatory fluctuating salinity. Because such a climate scenario has been predicted, it is intriguing to mechanistically understand euryhalinity and how this complex physiological phenotype evolves under high selection pressure.