How do we know which kinds of dinosaurs were most closely related?

Although most of the news stories one reads about dinosaurs involve spectacular, if not speculative, aspects of dinosaur history, such as new theories about their behavior, extinction, or ecology, less attention is paid to studies analyzing their evolutionary relationships. This is unfortunate because understanding questions of dinosaur behavior and biology depends on a firm understanding of their evolutionary relationships.

To reconstruct the evolutionary relationships between different groups of dinosaurs, one must carefully study and analyze the anatomy, essentially searching for characteristics that are shared among different kinds of dinosaurs, which are then interpreted to have been present in the common ancestor, or first member of a group, and inherited by its descendants. This analysis produces a branching diagram, called a cladogram, on which different kinds of dinosaurs are shown at the endpoints of the branches. The branching points connecting the different branches represent the common ancestor for the group whose branches come out of that branching point, and based on the characteristics shared by dinosaurs on those branches, we can infer that those shared characteristics were present in the common ancestor.

The result is a pattern of smaller groups of dinosaurs contained within larger groups of dinosaurs. For example, T. rex is a member of a small group (Tyrannosauridae) that also contains Albertosaurus. Both those are members of a larger group, which contains other meat-eating dinosaurs such as Allosaurus, Velociraptor and birds, called Theropoda. Then, all theropods belong to a larger group that also contains the giant sauropods, called Saurischia. A good way to think about this is to compare it to your evolutionary relationships as a human. Humans, along with apes, belong to a larger group of mammals called hominoids, and hominoids along with monkeys, lemurs and tarsiers all belong to the larger group called primates. By following the sequence of characteristics inherited from more distant common ancestors to more recent ones, one can trace the anatomical evolution of a particular kind of animal.