A frightening predator that ruled the oceans 500 million years ago was the original bug-eyed monster, scientists have discovered.

Anomalocaris was the stuff of nightmares – an invertebrate over three feet long with a soft body, formidable grasping claws and a circular mouth lined with tooth-like serrations.

The new evidence shows that it also possessed astonishingly large compound eyes, giving the creature powers of vision rivalling or exceeding that of most living insects and crustaceans.

Each of its two eyes sat on stalks, measuring up to three centimetres in length, and contained more than 16,000 separate hexagonal lenses.

Fossil eyes dated to 515 million years ago from Kangaroo Island, South Australia, reveal that Anomalocaris had superb vision which it used to hunt prey, including trilobites.

Compound eyes later became a shared feature of numerous arthropods – animals with jointed limbs – such as flies and crabs. The new discovery shows that compound eyes evolved before hardened exoskeletons and suggests Anomalocaris was a close relative of arthropods.

Only a few modern arthropods, including dragonflies, are believed to possess powers of vision that equal those of Anomalocaris.

Efficient predators such as Anomalocaris may have started an arms race that drove evolution on during the Cambrian period, according to the authors led by John Paterson, from the University of New England in Armidale, Australia.

They wrote: “The large absolute size and huge number of lenses in the eyes of Anomalocaris confirm its status as a highly visual apex predator.

“The presence of sophisticated nektonic (strong swimming) predators with acute vision, such as Anomalocaridids, within Cambrian communities would have placed considerable selective pressure on prey that would have influenced the ‘arms race’ that began during this important phase in early animal evolution.”