The extinct genus Limnobiophyllum (Araceae) has been considered a tentative link between the Aroideae and Lemnoideae subfamilies of Araceae. General understanding of morphological character evolution among these subfamilies has been limited due to the lack of preserved key structures in fossils such as infructescences. In this study, a new fossil species, Limnobiophyllum pedunculatum Low, Su & Xing sp. nov., is reported based on unusually complete specimens with intact leaves, stolon and attached infructescence and seeds from the late Oligocene of central Tibet, China. It represents the first convincing Limnobiophyllum fossil from the Tibetan Plateau and the first well-documented occurrence from east Asia. Its phylogenetic position was inferred using a matrix of 56 morphological characters and 5226 gene sequences of 41 taxa. Phylogenetic inference based on the matrix suggests that Limnobiophyllum is sister to Cobbania, as well as to the remaining extinct and living genera within the Araceae subfamily Lemnoideae. Reconstruction of vegetative and reproductive character evolution confirms that Limnobiophyllum possessed intermediate characters, especially for infructescences, between the subfamilies Lemnoideae and Aroideae. Within Lemnoideae, both vegetative and reproductive characters show clear reduction and simplification from extinct genera to living lemnoids. These findings shed new light on the evolutionary history of the family Araceae. In addition, the discovery of this species, in association with the surrounding plant megafossil assemblage, suggests a warm, humid lowland environment in the central Tibetan Plateau during the late Oligocene, contradicting previous studies that indicated high elevation of the plateau since the early Palaeogene. However, the extinction of Limnobiophyllum might have been due to both global cooling and orogenesis.