The lichenized basidiomycete Lepidostroma vilgalysii is described from Mexico based on morphological analyses. The species is only the second representative of the family Lepidostromataceae documented from the New World, and is one of the few described lichens with an inverted morphology, with the algae in a layer at the base of the thallus. Molecular sequence data from the nuclear ribosomal LSU locus are used to confirm the placement of the holotype in Lepidostroma and to evaluate the molecular distinctiveness of the species from all other described species in the family and genus.