Cryolophosaurus ellioti Hammer and Hickerson, 1994, from the Early Jurassic Hanson Formation of the Central Transantarctic Mountains, represents a theropod dinosaur from a period of time and geographical area that are poorly sampled with respect to dinosaur taxa. An in-depth morphological description of Cryolophosaurus is presented here, along with a rigorous phylogenetic analysis of theropod relationships consisting of 347 characters and 56 taxa, in an attempt to clarify the relationships of Cryolophosaurus and to provide insight into questions surrounding early theropod evolution. Cryolophosaurus is characterized by a unique cranial crest, formed primarily by the lacrimals, a pronounced constriction of the squamosal and jugal bones across the infratemporal fenestra, and extremely elongate cranial processes on the cervical ribs. Several shared characters, including the presence of a slot-shaped foramen at the base of the nasal process of the premaxilla, nasolacrimal crests and erect tab-like dorsal processes on the articular, suggest affinities between Cryolophosaurus and a clade of medium-bodied Early Jurassic theropods that includes ‘Dilophosaurus’sinensis, Dracovenator regenti and Dilophosaurus wetherilli. This clade is recovered as sister-taxon to a Neoceratosauria + Tetanurae clade, rendering both a traditional Coelophysoidea and Ceratosauria non-monophyletic. Cryolophosaurus represents the largest known Early Jurassic theropod, and marks the beginning of theropod occupation of the dominant predator niche in the Mesozoic. © 2007 The Linnean Society of London, Zoological Journal of the Linnean Society, 2007, 151, 377–421.