The ecologically diverse genus Coniochaeta (Coniochaetaceae, Ascomycota) contains numerous endophytic strains that occur in healthy leaves and lichen thalli in temperate and boreal North America. These endophytes frequently represent undescribed species. Here we examine two endophytic isolates of Coniochaeta from healthy photosynthetic tissue of Platycladus orientalis (Cupressaceae), a conifer cultivated for horticultural use in Arizona, USA. On the basis of morphology, in vitro assays, phylogenetic analyses of two loci, and analyses of whole genome data, we designate these endophytes as a novel species, Coniochaeta endophytica sp. nov. Strains of C. endophytica are closely related to an isolate from a native lichen in North Carolina, which we also characterize here. We compare C. endophytica with two known species that appear to be close relatives: C. prunicola, associated with wood necrosis in stonefruit trees in South Africa, and C. cephalothecoides, isolated from soil in Asia. The new species is distinct in phylogenetic, in vitro, and whole-genome analyses from C. prunicola, and differs slightly in conidiophore morphology from that species. Although available sequence data for C. cephalothecoides are of uncertain relation to the type specimen for that species, our results support the distinctiveness of C. endophytica on the basis of morphology, perithecial formation, and phylogenetic analyses. We discuss the challenge of identifying new species in the context of fungal ecology surveys, such as those for endophytes, which often rely only on a single locus and can misidentify taxa based on their closest matches in public databases or simple comparisons of barcode sequences alone.