Anamorphic basidiomycetous yeast strains M9962T and M9963 were isolated from water samples collected from a small stream in Ohwakudani, Hakone, a hot-spring area in Japan. These belonged to a single species and were phylogenetically closely related to Bullera lagerstroemiae, although the ability to form ballistoconidia was not observed. Based on sequence analyses of the D1/D2 domain of the LSU rDNA and ITS regions and differences in G+C content, the name Cryptococcus tepidarius sp. nov. Takashima, Sugita, Toriumi et Nakase (Trichosporonales, Tremellomycetes, Basiomycota) is proposed for these isolates, with strain M9962 T (5SP-5 T 5JCM 11965 T 5CBS 9427 T ) as the type strain. The strains grew in YM broth at 47 6C and in YM broth with the pH adjusted to 1.5 by HCl, indicating that the species is thermotolerant and acid-tolerant.