A combination of molecular phylogenetic analyses of ITS and mtSSU sequences, morphological and chemical analyses were used to investigate the lineages nominally included in the sterile lichen genus Lepraria. A core group (Lepraria s. str.) was resolved as sister to Stereocaulon. Species producing the secondary compounds argopsin, pannarin and usnic acid were found to belong to other lineages of lichen-forming ascomycetes. Study of Leprocaulon revealed that all species, except the type, likely represent members of Lepraria s. str. that have evolved a fruticose growth form. The correct name for the type species of Leprocaulon is shown to be L. quisquiliare, not L. microscopicum, and the genus is redefined to include several species previously placed in Lepraria. Leprocaulon quisquiliare is also shown to comprise two morphologically convergent species. The name is lectotypified and epitypified on material from the type region (Germany) and its application restricted to Old World populations. New World populations of L. quisquiliare are described as L. americanum. Leprocaulon, in its revised sense, is recognized in a new family (Leprocaulaceae) and order (Leprocaulales) sister to the Caliciales and including the genus Halecania. A new genus of Pilocarpaceae, Nelsenium, is introduced to accommodate Lepraria usnica. The status of Lepraria ecorticata is discussed in the context of usnic acid-producing Lecanora species. These nomenclatural novelties are proposed: (i) transfers from Leprocaulon to Lepraria: Lepraria albicans comb. nov., L. arbuscula comb. nov., L. congestum comb. nov., L. gracilescens comb. nov., L. pseudoarbuscula comb. nov., L. subalbicans comb. nov., L. tenellum comb. nov.; (ii) transfers from Lepraria to Leprocaulon: Leprocaulon adhaerens comb. nov., L. coriense, L. santamonicae comb. nov., L. terricola comb. nov. and L. textum comb. nov.; (iii) new taxa: Leprocaulales ord. nov., Leprocaulaceae fam. nov., Nelsenium gen. nov., Leprocaulon americanum sp. nov. and L. knudsenii sp. nov.