Genus Chaetopsinectria is established to accommodate four species, previously assigned to Cosmospora, that possess Chaetopsina anamorphs, small and red perithecia not collapsing when dry, a typical Cosmospora perithecial wall structure, clavate asci, smooth or striate ascospores, sienna colonies on PDA, and on decaying debris or woody substrates. The segregation of the new genus from Cosmospora is well supported by sequence analyses of nuclear ribosomal DNA (ITS and 28S partial) with maximum parsimony and Bayesian methods. The molecular data indicate that the new genus is distantly related to Cosmospora coccinea Rabenh., the type species of Cosmospora sensu stricto, and its related fungi. Four new combinations, Chaetopsinectria chaetopsinae, C. chaetopsinae-catenulatae, C. chaetopsinae-penicillatae and C. chaetopsinae-polyblastiae, are proposed.