The new liverwort species Chiastocaulon raetzelii is described from New Caledonia. Chiastocaulon raetzelii is characterized by very fragile, caducous leaves, stems therefore often becoming completely denuded of leaves; only bract leaves of the androecia are permanent and often the only ones remaining on the stem. Plants are minute with leafy shoots to 1 mm wide. Leaves on leafy shoots are arranged in opposing pairs, they are obovate-truncate to spathulate, with 3-7 teeth per leaf, teeth are filiform, consisting of long rectangular cells, and occupy about 1/3 to 1/4 of the entire leaf length. The species is compared to C. oppositum and C. geminifolium, which are the most similar morphologically.