Thelohania montirivulorum sp. nov., a new species of microsporidian parasite, was found in a highland population of the Australian yabby, Cherax destructor. Data are presented on fine ultrastructure, developmental morphology and DNA sequence of the small subunit ribosomal DNA (SSU rDNA) and internal transcribed spacer region. The phylogenetic relationships of T. montrivulorum sp. nov. and other crayfish parasites in the genus Thelohania, based on the SSU rDNA sequence, are investigated. Fine ultrastructure, patterns of sporogony and SSU rDNA sequence similarities indicate T. montirivulorum sp. nov. is congeneric with T. parastaci, a parasite of lowland populations of C. destructor, and with T. contejeani, a parasite of European freshwater crayfish. SSU rDNA data suggests Thelohania species found in crustacean hosts are more closely related to the Vairimorpha/ Nosema clade of species from insect and crustacean hosts than to the fire ant parasites, T. solenopsae and Thelohania sp.