Indigofera is a genus of the tribe Indigofereae (Leguminosae, Papilionoideae), with approximately 750 species distributed across tropical and subtropical regions of the world. In Brazil, the genus is associated mostly with the seasonally dry biomes of Caatinga and Cerrado, where 12 out of the 13 species recorded in Brazil occur. A close examination of the morphological variation in the Caatinga species showed that more than one species could be identified among the specimens referred to as I. blanchetiana. We thus propose the new species I. morroensis, which is distinguishable from I. blanchetiana by its habit, the number, shape, and hairiness of leaflets, and shape of the fruit. Indigofera morroensis occurs on sand dunes of the Morro do Chapéu municipality in Bahia state and its conservation status was assessed as Endangered. We provide the description, illustration, taxonomic comments, and distribution map for this new species, as well as an identification key for the species from Northeastern Brazil, including those that occur in the Caatinga.