Chaetetes, a hypercalcified sponge, formed expansive biostromes in Atokan strata of the Hueco Mountains, West Texas, where they grew in very shallow water on a broad shallow carbonate shelf. The Chaetetes there have tabular, columnar, compound-columnar, and branching shapes, and grew to heights of greater than 1 m. In most cases, they grew from a point source with an axial growth style. The laminar growth style occurs rarely, overlying growth interruption surfaces and where initial growth was on a hard surface such as solitary rugose corals. From the analysis of these fossils in the context of their inferred paleoenvironment, and integrating observations and available data from other localities, we conclude that the morphology of Chaetetes—their shape and growth style—was determined primarily by sedimentation parameters concurrent with their growth. These parameters were substrate character—texture and firmness—and both overall rate of sediment accumulation and variations in the rate relative to the rate of Chaetetes growth. Six species of Chaetetes were described previously in North America. Four of these are too incompletely known to be of taxonomic value. The other two, Chaetetes milleporaceus and Chaetetes favosus, form a continuum of morphotypes that is interpreted here to represent a single species, C. milleporaceus by priority.