An examination of a series of collections from the coast of Natal, South Africa, has revealed the presence of two species of Martensia C. Hering nom. cons: M. elegans C. Hering 1841, the type species, and an undescribed species, M. natalensis sp. nov. The two are similar in gross morphology, with both having the network arranged in a single band, and with reproductive thalli of M. elegans usually larger and more robust than those of M. natalensis. Molecular studies based on rbcL sequence analyses place the two in separate, strongly supported clades. The first assemblage occurs primarily in the Indo-West Pacific Ocean, and the second is widely distributed in tropical and warm-temperate waters. Criteria that have been used in the past for separating the two, namely, the number and shape of the blades, the presence of a single- versus a multiple-banded network, and blade margins entire or toothed, were determined to be unreliable. Although the examination of additional species is required, the morphology and position of procarps and cystocarps, whether at or near the corners of the longitudinal lamellae and the cross-connecting strands or along the lobed, membranous edges of the longitudinal lamellae or on the thallus margins, may prove to be diagnostic at the subgenus level. We recognize subg. Martensia, including the type of Martensia: M. elegans and subg. Mesotrema (J. Agardh) De Toni based on Martensia pavonia (J. Agardh) J. Agardh.