A new Peyssonnelia species is described from deep-water habitats in Puerto Rico as well as the U.S. Virgin Islands. Peyssonnelia incomposita is distinctive when living due its background orange coloration with highly contrasting bright yellow highlights. Internally the thallus is distinguished by abundant cell fusions that occur both laterally and longitudinally among cell rows of the perithallus as well as between cells of adjacent perithallial filaments at different tier levels. Tetrasporangia are cut off distally and possess an enlarged pedicel. They measure to 30 m wide and 75 m long. The crusts are closely appressed to the substratum and while variable, normally measure approximately 75 m in thickness.