Shotgun metagenomics methods enable characterization of microbial communities in human microbiome and environmental samples. Assembly of metagenome sequences does not output whole genomes, so computational binning methods have been developed to cluster sequences into genome 'bins'. These methods exploit sequence composition, species abundance, or chromosome organization but cannot fully distinguish closely related species and strains. We present a binning method that incorporates bacterial DNA methylation signatures, which are detected using single-molecule real-time sequencing. Our method takes advantage of these endogenous epigenetic barcodes to resolve individual reads and assembled contigs into species- and strain-level bins. We validate our method using synthetic and real microbiome sequences. In addition to genome binning, we show that our method links plasmids and other mobile genetic elements to their host species in a real microbiome sample. Incorporation of DNA methylation information into shotgun metagenomics analyses will complement existing methods to enable more accurate sequence binning.