Microbialites played a major role in the Precambrian ecosystems but became restricted to stressful marginal environments for most of the Phanerozoic, reaching comparable abundance and expansion only in the aftermath of some mass extinctions. Microbialite occurrences are known from Permian deposits of the Paraná Basin, but they are all geographically restricted and mostly associated with hypersaline settings. Here are reported silicified, microfossiliferous microbialite beds of the middle Permian Teresina Formation at two localities in the center of São Paulo State, Brazil, which are separated from each other by approximately 40 km. These microbialites occur in successions that are mainly devoid of animal body and trace fossils. Similarities in microbialite morphotype and microstructure, microfossil content and preservation, and diagenetic histories strongly suggest a stratigraphic correlation and, therefore, a major microbial development over an extensive area, contrasting with the previously known restricted occurrences. This development seems to be related to the establishment of more arid conditions in the Paraná Basin, ultimately linked to the formation of Pangea.