DNA sequences show that the traditional genus Micromphale appears to be polyphyletic. Nuclear ribosomal LSU and ITS DNA sequences place Micromphale sect. Perforantia Singer (typus sect. M. perforans) within Gymnopus, comprising a clade sister to a mixture of traditional Gymnopus taxa including G. fusipes (typus generis) plus traditional Marasmius sect. Androsacei. This study enlarges sect. Perforantia and shows that sect. Perforantia is a clade separate from those including Micromphale sect. Micromphale and sect. Rhizomorphigena. A new subsection Pinophili is proposed to include new species G. pinophilus and G. ponderosae. Eleven taxa are accepted at species rank, of which nine are proposed as new, mostly morpho-taxa.