In Shark Bay, wild bottlenose dolphins (Tursiops sp.) apparently use marine sponges as foraging tools. We demonstrate that genetic and ecological explanations for this behavior are inadequate; thus, "sponging" classifies as the first case of an existing material culture in a marine mammal species. Using mitochondrial DNA analyses, we show that sponging shows an almost exclusive vertical social transmission within a single matriline from mother to female offspring. Moreover, significant genetic relatedness among all adult spongers at the nuclear level indicates very recent coancestry, suggesting that all spongers are descendents of one recent "Sponging Eve." Unlike in apes, tool use in this population is almost exclusively limited to a single matriline that is part of a large albeit open social network of frequently interacting individuals, adding a new dimension to charting cultural phenomena among animals.