We redescribe a species of fiddler crab, Minuca panema (Coelho, 1972), from the Atlantic coast of South America. Until now, the taxon has been considered to be synonymous with a closely related species Minuca burgersi (Holthuis, 1967). We found two clades of M. burgersi sensu lato to be restricted to the Caribbean Basin while M. panema occurs along the eastern coast of South America from the island of Trinidad to Praia da Armaçāo, Santa Catarina, Brazil. The taxon is also closely related to M. mordax (Smith, 1870). Based on our field studies, the geographical boundary between M. burgersi sensu stricto and M. panema is the Tobago Basin, north of Trinidad. Since the two species diverged only 3 to 4 million years ago, as dated from the phylogeny of the genus Minuca Bott 1954, reliable distinguishing morphological landmarks are exiguous.