Tropical evergreen forests of Indian subcontinent, especially of the Western Ghats, are known hot spots of amphibian diversity, where many new anuran species await to be identified. Here we describe from the Sharavathi River basin of central Western Ghats a new shrub-frog taxon related to the anuran family Rhacophoridae. The new frog possesses the characteristic features of rhacophorids (dilated digit tips with differentiated pads circumscribed by a complete groove, intercalary cartilages on digits, T-shaped terminal phalanges and granular belly, the adaptive characters for arboreal life forms), but also a suite of unique features that distinguish it from all known congeners in the region. Morphogenetic analysis based on morphological characteristics and diversity in the mitochondrial 12S and 16S rRNA genes revealed it to be a new Philautus species that we named Philautus neelanethrus sp. nov. The phylogenetic analysis suggests the new frog to represent a relatively early Philautus species lineage recorded from the region. The distribution pattern of the species suggests its importance as a bioindicator of habitat health. In general, this relatively widespread species was found distributed only in non-overlapping small stretches, which indirectly indicates the fragmentation of the evergreen to moist deciduous forests that characterize the Western Ghats. Thus the discovery of the new rhacophorid species described here not only further reinforces the significance of the Western Ghats as a major hotspot of amphibian biodiversity, but also brings into focus the deterioration of forest habitats in the region and the need for prioritization of their conservation.