A relatively complete skull of Parelasmotherium, a giant elasmotherine rhinocerotid with a huge nasal horn, is described from an early late Miocene locality of the Linxia Basin in Gansu, China. Comparing the new cranial material of Parelasmotherium, we confirm that Ningxiatherium belongs to a valid and independent genus. New knowledge concerning the cranial and dental morphology of Parelasmotherium allows insight into the phylogenetic position of this genus among elasmotheres. A sister-group relationship between Parelasmotherium and Ningxiatherium is proposed on the basis of cranial and dental evidence. Shared derived characters that support this relationship include: anterior rims of orbit far behind the level of M3; raised lower rim of orbit; long, wide, fused nasal bones that angle ventrally; a retracted nasal notch at the level of the P4/M1 boundary; broadly separated parietal crests; tooth rows restricted to the anterior half of skull; extremely expanded hypocones of molars; very narrow metalophs; and a lingually elongated protoloph of M3. Parelasmotherium was obviously a grazer, as shown by the high crown, strong wear, massive cement, and wrinkled enamel on its teeth. The coexistence of Parelasmotherium and Ningxiatherium in the Linxia Basin indicates that the ecological differentiation occurred during the early late Miocene. The two genera occupied different ecological niches with distinct diets, grazing grasses for Parelasmotherium and browsing leaves for Ningxiatherium.