This study presents the first comprehensive revision of ‘pholidophoriform’ fishes, which are a key taxon for understanding the early diversification of teleost fish. Systematic revisions of Triassic pholidophorids, which are based on numerous well-preserved specimens, include †Annaichthys, gen. et sp. nov., †Knerichthys, gen. nov., †Parapholidophorus, †Pholidoctenus, †Pholidophoretes, †Pholidophorus, †Pholidorhynchodon, and †Zambellichthys, gen. et sp. nov. The morphological descriptions presented support a phylogenetic analysis that proposes a new hypothesis for character evolution within basal Teleostei, with implications for holosteans and teleosteans. The phylogenetic analysis resolves traditional ‘pholidophoriform’ species as a paraphyletic assemblage, with some grouped in a monophyletic †Pholidophoridae and others more closely related to crown-group teleosts. The monophyletic Family †Pholidophoridae is restricted to European Triassic taxa and is the sister group of the Jurassic genus †Eurycormus plus all other teleosts. The latter clade is supported by several synapomorphies, such as an elongate posteroventral process of the quadrate, long epineural processes, and seven or more ural neural arches modified as uroneurals. †Pholidophorus bechei is removed from †Pholidophoridae and recognized as the new genus †Dorsetichthys. Current evidence indicates that the Upper Triassic †Pholidophoretes salvus and †Knerichthys bronni represent the oldest known pholidophorids, and †Prohalecites from the Middle/Upper Triassic boundary represents the oldest stem teleost. Aspidorhynchiforms, pachycormiforms, and †Prohalecites are resolved as stem teleosts. The monophyly of Teleostei, which now includes Triassic pholidophorids, is supported by numerous synapomorphies, such as one suborbital, two supramaxillae, and the articular fused to the angular and retroarticular bones—with further transformations within more advanced teleosts. Synapomorphies of Teleosteomorpha, the clade including crown-group teleosts and all fish more closely related to them than to their closest extant relatives, include the autosphenotic lacking a dermal component, an unpaired vomer, and one long, toothed, serrated appendage on the cleithrum.