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Background: Chinese bayberry (Myrica rubra Sieb. and Zucc.) is a subtropical evergreen tree originating in China. It has been cultivated in southern China for several thousand years, and annual production has reached 1.1 million tons. The taste and high level of health promoting characters identified in the fruit in recent years has stimulated its extension in China and introduction to Australia. A limited number of co-dominant markers have been developed and applied in genetic diversity and identity studies. Here we report, for the first time, a survey of whole genome shotgun data to develop a large number of simple sequence repeat (SSR) markers to analyse the genetic diversity of the common cultivated Chinese bayberry and the relationship with three other Myrica species. Results: The whole genome shotgun survey of Chinese bayberry produced 9.01Gb of sequence data, about 26x coverage of the estimated genome size of 323 Mb. The genome sequences were highly heterozygous, but with little duplication. From the initial assembled scaffold covering 255 Mb sequence data, 28,602 SSRs (≥5 repeats) were identified. Dinucleotide was the most common repeat motif with a frequency of 84.73%, followed by 13.78% trinucleotide, 1.34% tetranucleotide, 0.12% pentanucleotide and 0.04% hexanucleotide. From 600 primer pairs, 186 polymorphic SSRs were developed. Of these, 158 were used to screen 29 Chinese bayberry accessions and three other Myrica species: 91.14%, 89.87% and 46.84% SSRs could be used in Myrica adenophora, Myrica nana and Myrica cerifera, respectively. The UPGMA dendrogram tree showed that cultivated Myrica rubra is closely related to Myrica adenophora and Myrica nana, originating in southwest China, and very distantly related to Myrica cerifera, originating in America. These markers can be used in the construction of a linkage map and for genetic diversity studies in Myrica species. Conclusion: Myrica rubra has a small genome of about 323 Mb with a high level of heterozygosity. A large number of SSRs were identified, and 158 polymorphic SSR markers developed, 91% of which can be transferred to other Myrica species. [ABSTRACT FROM AUTHOR]