Squamate reptiles (lizards and snakes) are a pivotal group whose relationships have become increasingly controversial. Squamates include >9000 species, making them the second largest group of terrestrial vertebrates. They are important medicinally and as model systems for ecological and evolutionary research. However, studies of squamate biology are hindered by uncertainty over their relationships, and some consider squamate phylogeny unresolved, given recent conflicts between molecular and morphological results. To resolve these conflicts, we expand existing morphological and molecular datasets for squamates (691 morphological characters and 46 genes, for 161 living and 49 fossil taxa, including a new set of 81 morphological characters and adding two genes from published studies) and perform integrated analyses. Our results resolve higher-level relationships as indicated by molecular analyses, and reveal hidden morphological support for the molecular hypothesis (but not vice-versa). Furthermore, we find that integrating molecular, morphological, and paleontological data leads to surprising placements for two major fossil clades (Mosasauria and Polyglyphanodontia). These results further demonstrate the importance of combining fossil and molecular information, and the potential problems of estimating the placement of fossil taxa from morphological data alone. Thus, our results caution against estimating fossil relationships without considering relevant molecular data, and against placing fossils into molecular trees (e.g. for dating analyses) without considering the possible impact of molecular data on their placement.