A new orchid species from the Chihuahuan Desert region in Tamaulipas, Mexico and Texas, U. S. A., is described and illustrated. The phylogenetic position of the new species was assessed by parsimony and maximum likelihood analyses of nuclear (ITS) and plastid (matK-trnK, trnL-trnF) DNA sequences of 61 species/35 genera of Spiranthinae and 15 additional species and genera of Cranichideae. The results indicate a close relationship of the new species to several species previously included in Schiedeella, especially S. wercklei, but our analyses also show that such a group does not belong to the clade that includes the type species of Schiedeella (S. transversalis), being instead sister to Mesadenus. A new genus, Greenwoodiella, is proposed to include the new species (G. deserticola) and its closest relatives (G. micrantha var. micrantha, G. micrantha var. garayana, and G. wercklei). The identity of Lexarza's Neottia micrantha is clarified, the other species belonging in this clade are discussed, and the required transfers made. An identification key to the three species and two varieties we recognize in the new genus is provided.