Introduction: Sex chromosomes often evolve through suppressed recombination and accumulation of transposable elements (TEs) on the sex-limited chromosome, leading to divergence and eventual degeneration. The clam shrimp Eulimnadia texana possesses proto-sex chromosomes (Z and W) at an early evolutionary stage, providing a unique opportunity to examine the initial genomic changes underlying sex chromosome differentiation. Additionally, both sex chromosomes are expressed in homogametic ZZ and WW shrimp, allowing a regular expression of both sex chromosomes in homozygotes. Methods: We analyzed newly assembled ZZ (male) and previously published WW (hermaphrodite) genomes of E. texana. Sex-linked markers were mapped to identify the Z chromosome. TEs were annotated using a species-specific repeat library and RepeatMasker. The Z and W chromosomes were divided into bins and randomization tests compared TE accumulation between the sex chromosomes as well as between corresponding regions within these two chromosomes; the latter was focused on the putative sex-determining regions of both the Z and W. Kimura distance-based analyses were used to estimate TE age divergence. Results: The Z chromosome showed no significant TE enrichment relative to autosomes but was enriched for DNA transposons. The W chromosome exhibited significantly higher retrotransposon (LTR and LINE) accumulation. Only the sex-determining region of the W showed significantly elevated retrotransposon content compared to the Z. TE age landscapes indicated recent bursts of retrotransposon activity on the W. Conclusion: These findings support theoretical predictions that retrotransposons accumulate in non-recombining regions, while DNA transposons are associated with recombining chromosomes. The W chromosome of E. texana shows early signs of differentiation, with localized retrotransposon buildup, while the Z remains autosome-like. This study highlights E. texana as a valuable model for understanding the genomic mechanisms of early sex chromosome evolution.