A taxonomic synopsis of the orchid genus Habenaria in New Guinea and adjacent islands is presented. We confirmed the occurrence of 27 Habenaria species in study area. Sixteen of these are endemic and were not so far found outside New Guinea. Morphological characteristics and illustrations of floral segments of taxa are presented. One new species of Habenaria is described. Four neotypes are selected. An updated key to species groups and species occurring in the study area is provided. The importance of diagnostic floral characters in Habenaria is discussed.