In this contribution we describe the fossil remains of a new genus and species of a giant rodent, Arazamys castiglionii (Mammalia, Rodentia, Dinomyidae), from Arazatí beach in San José Department, southern Uruguay. The specimen was exhumed from pelitic sediments of the Camacho Formation, biostratigraphically assigned to the late Miocene Huayquerian South American Land Mammal Age. The remains include an incomplete skull (braincase, auditory region, and nearly full dentition) and the atlas. Based on comparative studies of the anatomy of the auditory region, we describe 2 morphologies for the subfamily Eumegamyinae, 1 characterized by a short meatus acusticus externus, a great development of the foramen stylomastoideum, and a conspicuous ectotympanic cavity, and a 2nd characterized by a long meatus acusticus externus and lack of the ectotympanic fossa. The potential taxonomic and systematic value of the auditory region in Dinomyidae is discussed.