As part of a long term study of fungi colonizing submerged wood in freshwater streams a new Annulatascus species, A. aquatorba, is described and illustrated from Erythrophleum teysmannii test blocks from Sirindhorn Peat Swamp Forest, southern Thailand. It differs from other species in the genus in ascospore measurements, thickness of the cell wall, 1-3-septate, fusoid to lunate shape, with central brown cells and subhyaline end cells and without a mucilaginous sheath. Asci are cylindrical, pedicellate, with a distinct, wedge-shaped and non-amyloid apical ring. Phylogenetic relationships of this species, based on the combined partial 18S and 28S rDNA, place it in the same clade as A. velatisporus (type species), A. hongkongensis and A. nilensis.