Two new psychrophilic Pseudogymnoascus species with Geomyces anamorphs are described from a Sphagnum bog in Alberta, Canada. Pseudogymnoascus appendiculatus has long, branched, orange appendages and smooth, fusoid to ellipsoidal ascospores with a faint longitudinal rim. Pseudogymnoascus verrucosus has short, subhyaline appendages and warty peridial hyphae and ascospores, and both smooth to asperulate and irregularly warty conidia. Both species produce asci in chains, a feature that supports the distinction between this group and Myxotrichum, which produces asci singly. The discovery of species intermediate between Pseudogymnoascus and Gymnostellatospora, in having both ornamented ascospores and Geomyces anamorphs, prompted a re-evaluation of the genera. Sequence analysis of the internal transcribed spacer regions (ITS) of the nuclear ribosomal DNA indicates that the two genera remain distinct and comprise a monophyletic group. Pseudogymnoascus species have smooth to warty or lobate-reticulate ascospores while species of Gymnostellatospora have walnut-shaped spores with distinct longitudinal crests and striations. Anamorphs assignable to the form genus Geomyces are allied with both genera. A key is provided to the four species and varieties of Pseudogymnoascus.