A taxonomic survey of Marphysa species (Polychaeta: Eunicida: Eunicidae) from coastal regions of northern Australia including recently collected specimens from a fish farm near Darwin, yielded three species: M. mullawa Hutchings & Karageorgopolous, 2003, a first record from northern Australia; M. mossambica (Peters, 1854; was Nauphanta mossambica), first confirmed record from Australia; and a new species, M. fauchaldi. The new species was recorded from intertidal muddy shores as well as in the sediments of fish farm ponds, where it was extremely abundant. It is characterised by a unique combination of chaetal features. A newly proposed informal subgroup of Marphysa, the Teretiuscula-group, is erected to contain the new species and other Marphysa species that share the possession of compound spinigerous chaetae in anterior parapodia only and the peculiar behaviour of encapsulating embryos in jelly cocoons. Morphologically, the new species falls between a group of Marphysa species having only compound spinigers and the recently resurrected genus Nauphanta, which completely lacks compound chaetae. The discovery of this new species necessitated a re-evaluation of the morphological features of Nauphanta and Marphysa species lacking falcigers, in particular homology of fan chaetae, the only apparent synapomorphy of Nauphanta. Fan chaetae appear to be a specialised type of pectinate chaetae, which are found also in species of Marphysa including the new species. Based on this finding, and an evaluation of other characters, Nauphanta is returned to synonymy with Marphysa. Further, an analysis of size-related variation of key morphological characters in M. mossambica and comparison with those in the types of M. novaehollandiae (Kinberg, 1865; formerly Nauphanta) and M. simplex Treadwell, 1922, indicated that both species should be synonymised with M. mossambica. A key is provided to identify Marphysa species of the Indo-west Pacific.
Key words: Annelida, taxonomy, systematics, Barra bloodworm, aquaculture, fish farm