Abstract Large chromosomal inversion polymorphisms are ubiquitous across the diversity of diploid organisms and play a large role in the evolution of adaptations in those species. Despite their importance, the underlying mechanisms by which inversions produce their adaptive phenotypic effects and become geographically widespread are still poorly understood. One way inversions could cause phenotypic effects is through meiotic recombination suppression, which can result in the formation of a supergene containing linked adaptive alleles. This supergene hypothesis has been promoted by theoreticians, but thus far, no studies have definitively identified multiple linked adaptive genes within an inversion. Alternatively, according to the breakpoint mutation hypothesis, the inversion mutation itself could result in adaptive phenotypic effects if it disrupts genes or alters regulation of nearby genes. Here, we evaluate both of these hypotheses using new long-read sequencing-based genomes of the yellow monkey flower, Mimulus guttatus . Our results provide support for both the supergene and breakpoint mutation hypotheses of adaptive inversion evolution and suggest that functional molecular studies will be required to definitively test each of these hypotheses. We also identified an ancient large inversion nested within a well-established adaptive inversion. This finding suggests that the supergene mechanism may occur in phases, with an expansion of the region of suppressed recombination capturing an increasing number of adaptive loci over time. Significance statement Large regions of chromosomes can become reversed in orientation due to mutations known as inversions. These inversions are often involved in the evolution of major organismal adaptations, yet we know little about this process. In this study, we show that the evolution of a large adaptive inversion in monkeyflowers could be due to both the trapping of beneficial genes into a supergene as well as changes in gene expression due to the inversion mutation itself. Further, we found that this inversion has trapped an even older inversion, which may itself have been adaptive. Thus, adaptive inversions on autosomes may evolve in sequence, much the same way that sex chromosomes evolve.