Cotylolabium is a monospecific, little-known genus endemic to a single mountain top in south-eastern Brazil. In this work, we present a detailed morphological description (including anatomical and histochemical aspects of the labellum) based on live and ethanol-preserved material of Cotylolabium lutzii. We also assess its phylogenetic position, analysing nucleotide sequences of plastid (matK–trnK, trnL–trnF) and nuclear DNA [internal transcribed spacer (ITS)] and discuss its conservation status. Our phylogenetic analysis strongly supports Cotylolabium as the sister of the rest of subtribe Spiranthinae. Inferences made from floral morphology, labellum anatomy and floral odour suggest melittophilous pollination. Possession of cauline leaves, minutely papillose leaf margins, decurrent floral bracts, an osmophore located on the outer labellum surface and, especially, a labellum neatly divided into a proximal, nectar-bearing portion (hypochile) and a distal portion (epichile) by a transverse blade (trabecula) are distinguishing characters of this taxon. The first-branching position of C. lutzii in our molecular trees supports an interpretation of the narrow, stiff rostellum remnant as plesiomorphic in the subtribe. The narrow endemicity and the phylogenetic position of C. lutzii both point to the relictual nature of this taxon, which is considered as critically endangered. © 2014 The Linnean Society of London, Botanical Journal of the Linnean Society, 2014, 175 29–46.