During March 2002 and November 2005, teleost fishes were collected at Lizard Island, Great Barrier Reef (GBR), Australia. Gnathiid isopod juveniles were allowed to detach from these host fishes and were maintained in fresh seawater until they molted into adults. Adult males emerged 5 days post-detachment (d.p.d.) and females 10 d.p.d. of juveniles from host fish. The adults and juveniles were identified as new to science and described as Gnathia aureamaculosa n. sp. The species description is based on brightfield and scanning electron microscopy observations primarily of males, since the taxonomy of gnathiids is based on male morphology. This species has been widely employed in various studies on the Great Barrier Reef, from its involvement in feeding patterns in reef fish to its role in transmitting blood parasites, and has been referred to as Gnathia sp. A. Distinctive features of the male include gold-spotted pigmentation on the dorsal pereon of live specimens, a cephalosome with a conical superior fronto-lateral process, an inferior and conical medio-frontal process, and mandibles, each with an armed carina and an internal lobe. The female is characterized by its broad, rounded shape and cephalosome setae. The mandible of the third stage juvenile has 2 small teeth on the tip and 7 large teeth on the mesial margin. Differential pigmentation occurs in live male and female third-stage juveniles; females have greenish-yellow spots distributed over the pereon and males have white blotches and light brown and yellow spots on the pereon.