We describe a unique ascomycete genus occurring on leaf litter of Castanopsis diversifolia from monsoonal forests of northern Thailand. Emarcea castanopsidicola gen. et sp. nov. is typical of Xylariales as ascomata develop beneath a blackened clypeus, ostioles are papillate and asci are unitunicate with a J+ subapical ring. The ascospores in Emarcea castanopsidicola are, however, 1-septate, hyaline and long fusiform, which distinguishes it from other genera in the Xylariaceae. In order to substantiate these morphological findings, we analysed three sets of sequence data generated from ribosomal DNA gene (18S, 28S and ITS) under different optimality criteria. We analysed this data to provide further information on the phylogeny and taxonomic position of this new taxon. All phylogenies were essentially similar and there is conclusive molecular evidence to support the establishment of Emarcea castanopsidicola within the Xylariales. Results indicate that this taxon bears close phylogenetic affinities to Muscodor (anamorphic Xylariaceae) and Xylaria species and therefore this genus is best accommodated in the Xylariaceae.