Sphaerolejeunea umbilicata Herzog, the only species of the genus Sphaerolejeunea Herzog, was until now known only from the type material collected in the Andes of Colombia in 1922. This critically endangered epiphyllous liverwort was rediscovered recently in the understory of a lower montane rainforest in northern Peru. It stands out by its leaf lobes bordered by hyaline cells, strongly inflated lobules, and terete perianths without keels or beak. The sporophyte, described here for the first time, is characterized by the seta made up of 4 12 cells, valves remaining suberect after dehiscence, the inner tangential capsule walls lacking fenestrate, sheet-like thickenings, and the 18 marginal and 4 additional elaters lacking spiral bands. Based on morphological similarities, Sphaerolejeunea is considered to be closely related to Lejeunea. In the present paper a complete description with illustrations is presented as well as a discussion of the ecology of the species, the systematic position and generic affinity of Sphaerolejeunea within the Lejeuneaceae, and its conservation status.