How far back can we go in this way? If we try to trace all life on our planet, we are constrained by the earth's age of 4.5 billion years. The oldest bacteria-like fossils are 3.5 billion years old, so this is the upper estimate for the age of life on the earth. The question is whether at some point before this date a last common ancestor for all forms of life, a "universal ancestor," existed. Over the past 30 years the underlying biochemical unity of all plants, animals and microbes has become increasingly apparent. All organisms share a similar genetic machinery and certain biochemical motifs related to metabolism. It is therefore very likely that there once existed a universal ancestor and, in this sense, all things alive are related to each other. It took more than two billion years for this earliest form of life to evolve into the first eukaryotic cell. This gave rise to the last common ancestor of plants, fungi and animals, which lived some 1.6 billion years ago.
The controversies surrounding biological evolution today reflect the fact that biologists were late in accepting evolutionary thinking. One reason for this is that significant modifications of living things are difficult to observe during a lifetime. Darwin never saw evolution taking place in nature and had to rely on evidence from fossils, as well as plant and animal breeding. His idea that the differences observed within a species are transformed in time into differences between species remained the most plausible theory of biodiversity in his time, but there was an awkward lack of direct observations of this process. Today this situation has changed. There are now a number of very striking accounts of evolution in nature, including exceptional work on the finches of the Galapagos Islands--the same animals that first inspired Darwin's work.
The Beak of the Finch : A Story of Evolution in Our Time (Vintage Books, 1995)