A new species of Veleroa, V. setteana Abbott & Ballantine, has been collected from the Northwestern Hawaiian Islands. Veleroa setteana is among the larger of the Veleroa species, reaching a height of 30 cm. The new species is highly corticated with cortication beginning in young thallus portions. Tetrasporangia, which measure up to 60 µm in diameter, possess three cover cells and are produced in principal indeterminate axes and more commonly in short indeterminate laterals. The genus Veleroa is properly placed in the Brongniartelleae.