Pannaria isidiosa sp. nov. is newly described from montane forests in New South Wales, Australia. It is characterized by abundant globose to coralloid isidia, long-ellipsoid spores with a verrucose and citriform perispore. It is related to P. xanthomelana, but in addition to pannarin and porphyrilic acid, it contains methylplacodiolic acid and a chemosyndrome of four unidentified terpenoids.