The extreme rarity of soft-tissue preservation in ammonoids has meant there are open questions regarding fundamental aspects of their biology. We report an exceptionally preserved Middle Jurassic ammonite with unrivaled information on soft-body organization interpreted through correlative neutron and X-ray tomography. Three-dimensional imaging of muscles and organs of the body mass for the first time in this iconic fossil group provides key insights into functional morphology. We show that paired dorsal muscles withdrew the body into the shell, rather than acting with the funnel controlling propulsion as in Nautilus. This suggests a mobile, retractable body as a defense strategy and necessitates a distinct swimming mechanism of hyponome propulsion, a trait that we infer evolved early in the ammonoid-coleoid lineage.