The sole species of Tepualia Griseb., Goett. Abh. 6 (1854) 119, T. stipularis (Hook. f. et Arn.) Griseb., loc. cit. 119, occurs in South America remote from the main Australasian concentration of the subfamily Leptospermoideae. It is the only representative of the subfamily in the Americas. The species was first placed in Myrtus (Hooker and Arnott, 1833), later transferred to Metrosideros (J. D. Hooker, 1847), and was finally segregated as a new genus by Grisebach (1854). Grisebach (1.c., 120) described a second species, T. philippiana, which is now treated as a synonym of T. stipularis. Tepualia stipularis is restricted to southern Chile and southern Argentina in lowland to lower montane sites where, according to herbarium labels, it grows in open, often swampy forest including Nothofagus forest.