Wheat has been domesticated into a large number of agricultural environments and has the ability to adapt to diverse environments. To understand this process, we survey genotype, repeat content, and DNA methylation across a bread wheat landrace collection representing global genetic diversity. We identify independent variation in methylation, genotype, and transposon copy number. We show that these, so far unexploited, sources of variation have had a significant impact on the wheat genome and that ancestral methylation states become preferentially “hard coded” as single nucleotide polymorphisms (SNPs) via 5-methylcytosine deamination. These mechanisms also drive local adaption, impacting important traits such as heading date and salt tolerance. Methylation and transposon diversity could therefore be used alongside SNP-based markers for breeding.