Selaginella iridescens (Selaginellaceae), a new species of spikemoss from Hainan Island, China, is described based on morphological and molecular evidence. The new species morphologically resembles S. pseudotamariscina from Vietnam which was recently recognized and segregated from S. tamariscina and S. pulvinata. Some characters of S. iridescens, including the iridescent leaves and long arista (0.35–1.20 mm long), the widely membranaceous margin of axillary leaves (ca. 2/3), dorsal leaves sulcate extending to the top, and slender main stem, dorsoventrally prostrate, distinguish it from S. pseudotamariscina. Phylogenetic results based on rbcL of 28 Selaginella species indicate that S. iridescens is sister to S. pseudotamariscina, and distant from the S. tamariscina-S.pulvinata clade. The ancestral character reconstruction result reveals that the rosette is apomorphic and has evolved independently at least six times in Selaginella.