Microbial genes encode the majority of the functional repertoire of life on earth. However, despite increasing efforts in metagenomic sequencing of various habitats, little is known about the distribution of genes across the global biosphere, with implications for human and planetary health. Here we constructed a non-redundant gene catalogue of 303 million species-level genes (clustered at 95% nucleotide identity) from 13,174 publicly available metagenomes across 14 major habitats and use it to show that most genes are specific to a single habitat. The small fraction of genes found in multiple habitats is enriched in antibiotic-resistance genes and markers for mobile genetic elements. By further clustering these species-level genes into 32 million protein families, we observed that a small fraction of these families contain the majority of the genes (0.6% of families account for 50% of the genes). The majority of species-level genes and protein families are rare. Furthermore, species-level genes, and in particular the rare ones, show low rates of positive (adaptive) selection, supporting a model in which most genetic variability observed within each protein family is neutral or nearly neutral.