The genus Coralliogalathea of the family Galatheidae is easily differentiated from other genera in the family by its small size, the presence of three to four small lateral teeth on the rostrum and the lack of the first pair of gonopods in males. The genus currently consists of only a single species, Coralliogalathea humilis, which lives in close association with corals in the Indian and Pacific Oceans. Using material collected across its distribution, we analysed both morphological characters and molecular markers (COI, 16S, 28S and 18S) to investigate cryptic species diversity, phylogenetic relationships within the genus, and the phylogenetic position of Coralliogalathea within the family Galatheidae. Our results support the validity of the two species previously synonymized with C. humilis and three new sympatric species found in Espiritu Santo, Vanuatu. Although these species are distinguishable only by subtle morphological characters, they are highly dissimilar genetically and constitute relatively deep divergent lineages. Furthermore, phylogenetic analyses of Galatheoidea resolved Coralliogalathea as an ancient genus within the superfamily that most probably diversified during the Eocene.