Two new species, Vararia bispora and V. montana collected from southern China, are described and illustrated based on morphological characters. Vararia bispora is characterized by cinnamon-buff to yellowish brown basidiocarps, clamped generative hyphae, ventricose gloeocystidia, 2-sterigmata basidia, and large fusiform to cylindrical basidiospores that are negative in Melzer's reagent. Vararia montana is characterized by small pulvinate basidiocarps, clamped generative hyphae, rather strongly dextrinoid dichohyphae, and broadly ellipsoid basidiospores with a peculiar beak-like extension, and without reactions in Melzer's reagent. In addition, V. ambigua and V. amphithallica are reported from China for the first time, and descriptions and illustrations are also provided for these two species.