Caenorhabditis auriculariae, which was morphologically described in 1999, was re-isolated from a Platydema mushroom-associated beetle. Based on the re-isolated materials, some morphological characteristics were re-examined and ascribed to the species. In addition, to clarify phylogenetic relationships with other Caenorhabditis species and biological features of the nematode, the whole genome was sequenced and assembled into 109.5 Mb with 16,279 predicted protein-coding genes. Molecular phylogenetic analyses based on ribosomal RNA and 269 single-copy genes revealed the species is closely related to C. sonorae and C. monodelphis placing them at the most basal clade of the genus. C. auriculariae has morphological characteristics clearly differed from those two species and harbours a number of species-specific gene families, indicating its usefulness as a new outgroup species for Caenorhabditis evolutionary studies. A comparison of carbohydrate-active enzyme (CAZy) repertoires in genomes, which we found useful to speculate about the lifestyle of Caenorhabditis nematodes, suggested that C. auriculariae likely has a life-cycle with tight-association with insects.