Auriscalpium greyorum is described for the fungus previously known as Auriscalpium sp. "Blackwood", an endangered species known from few sites in Eucalyptus forests in Victoria, Australia. Microscopically, A. greyorum is consistent with other species of the genus by the presence of amyloid, ornamented spores and gloeoplerous hyphae and cystidia — but the very reduced stipe, at most 7 mm long, embedded in the bark of the substrate, differs from the well-developed stipe present in most other species of the genus. Phylogenetic analysis of internal transcribed spacer (ITS) rDNA demonstrated that A. greyorum is well-separated from the seven other named species of Auriscalpium for which sequence data are available, including from A. andinum, a South American species with a very short stipe. Within the clade of Auriscalpium species, sequences of collections from the southern hemisphere, including A. greyorum, form a grade, with sequences from Gloiodon, Dentipratulum and A. villipes (from Mexico) interspersed between this southern hemisphere grade and the clade of the remaining northern hemisphere species of Auriscalpium. Therefore, further exploration of the generic limits of these three genera is warranted. Auriscalpium greyorum is threatened by inappropriate fire regimes, habitat disturbance and climate change.