AbstractNew Guinea and surrounding islands are home to some of the richest assemblages of insular biodiversity in the world. The key geological drivers of species richness in this region are largely considered to be mountain uplift and development of offshore archipelagos—some of which have accreted onto New Guinea—with the role of mountain uplift and elevational gradients receiving more attention than the role of isolation on islands. Here, we examine the distribution of lineage richness and body-size diversity in a radiation of Melanesian lizards that is almost entirely absent from montane habitats but closely associated with islands—the geckos of the genus Nactus. Our data indicate that eastern New Guinea—centred on the East Papuan Composite Terrane (EPCT)—shows particularly high levels of endemism and body-size diversity and is also inferred to be a source area for multiple independent colonisations elsewhere in New Guinea, the Pacific and Australia. Two Nactus lineages in Australia have closest relatives occurring to the north of New Guinea’s Central Cordillera, suggesting dispersal through this area in the mid-Miocene, possibly via seaways that would have isolated the islands to the east and west of the proto-Papuan region. Syntopic species tend to differ in body length; however, at a phylogenetic scale, this trait appears to be conservative, with small-sized and large-sized species clustered into separate lineages. These data suggest that species richness in Melanesian Nactus is in part explained by morphological diversification enabling the presence of sympatric communities to exist, but to a greater extent by multiple instances of dispersal and extensive allopatric and parapatric speciation, especially in and around the islands of the EPCT.