Legumes preferentially associate with and reward beneficial rhizobia in root nodules, but the processes by which rhizobia evolve to provide benefits to novel hosts remain poorly understood. Using cycles of in planta and in vitro evolution, we experimentally simulated lifestyles where rhizobia repeatedly interact with novel plant genotypes with which they initially provide negligible benefits. Using a full-factorial replicated design, we independently evolved two rhizobia strains in associations with each of two Lotus japonicus genotypes that vary in regulation of nodule formation. We evaluated phenotypic evolution of rhizobia by quantifying fitness, growth effects and histological features on hosts, and molecular evolution via genome resequencing. Rhizobia evolved enhanced host benefits and caused changes in nodule development in one of the four host-symbiont combinations, that appeared to be driven by reduced costs during symbiosis, rather than increased nitrogen fixation. Descendant populations included genetic changes that could alter rhizobial infection or proliferation in host tissues, but lack of evidence for fixation of these mutations weakens the results. Evolution of enhanced rhizobial benefits occurred only in a subset of experiments, suggesting a role for host-symbiont genotype interactions in mediating the evolution of enhanced benefits from symbionts.