A major challenge in evolutionary biology has been to explain the variation in multicellularity across the many independently evolved multicellular lineages, from slime moulds to vertebrates. Social evolution theory has highlighted the key role of relatedness in determining multicellular complexity and obligateness; however, there is a need to extend this to a broader perspective incorporating the role of the environment. In this paper, we formally test Bonner's 1998 hypothesis that the environment is crucial in determining the course of multicellular evolution, with aggregative multicellularity evolving more frequently on land and clonal multicellularity more frequently in water. Using a combination of scaling theory and phylogenetic comparative analyses, we describe multicellular organizational complexity across 139 species spanning 14 independent transitions to multicellularity and investigate the role of the environment in determining multicellular group formation and in imposing constraints on multicellular evolution. Our results, showing that the physical environment has impacted the way in which multicellular groups form, highlight that environmental conditions might have affected the major evolutionary transition to obligate multicellularity.