A new species of horseshoe bat (Chiroptera: Rhinolophidae) is described from southwestern China. The presence of a wedge-shaped sella and pointed connecting process of the nose leaf aligns the new species to the landeri group in the Afro-Palearctic lineage of Rhinolophus. However, the new species is distinctly separable from these allopatrically distributed species by its noticeably larger body size. Other sympatric large-sized species of Rhinolophus have rounded connecting processes. Molecular systematic analyses based on mitochondrial cytochrome-b sequences confirmed the affinity of the new species to the Afro-Palearctic lineage, but in a clade most closely related to the ferrumequinum, fumigatus, and maclaudi groups. Of these species, only R. ferrumequinum ranges into Asia and overlaps in distribution with the new species. R. ferrumequinum is similar in general body size and external appearance; however, the new species is distinct in the characteristics of the nose leaf, skull, and baculum. The presence of a new species from southwestern China in the Afro-Palearctic lineage indicates a more complex historical biogeographic scenario within Rhinolophus than previously known. The difficulties found in allocating the new species to one of the phenetically described traditional species groups stress the convenience of using a phylogenetically based systematic organization of the genus Rhinolophus.