Although Proto-Oceanic has been reconstructed as having three labiovelar consonants (* b w,* p w, and* m w) that contrast with simple bilabials, this distinction was apparently not present in Proto-Austronesian or Proto-Malayo-Polynesian. Various theories have been proposed to account for their origin; few go into any real detail, and no single theory seems to account for most or all of the facts in a satisfactory manner. At the same time, there are numerous inconsistencies in reflexes of many etyma containing one of these phonemes, even with languages that can be thought of as" exemplary" in normally reflecting a Proto-Oceanic labiovelar separately from a bilabial. This paper evaluates the various theories of origin that have been proposed and attempts to explain the development of labiovelars in Proto-Oceanic and its early descendants, their somewhat unusual phonotactic distribution, and the inconsistency in correspondences. I suggest that phonological conditioning and borrowing are both involved, but also propose other factors—dissimilation of rounded vowels adjacent to newly created labiovelar allophones, which led to contrast between simple bilabials and labiovelars; the use of the bilabial/labiovelar distinction to distinguish semantically similar forms; and the increased functional load of labiovelars in newly created words. I also try to explain why labiovelars seem to be considerably more frequent in Eastern than in Western Oceanic.