Plants of the lycophyte genus Phlegmariurus contain the chemical compound Huperzine A, the effective medicinal component treating Alzheimer's disease, thus with huge economic value. To protect the natural resources, plants of the whole genus are listed as the National Key Protected Wild plants in China. In this paper, we revised the taxonomy of Phlegmariurus distributed in China based on morphological, ecological, and geographical evidence. We recognized 21 species from China, and organized them into four sections. Sect. Fargesiani X. C. Zhang & R. H. Jiang is newly established, and the other three sections were revised based on previous studies, i.e., Sect. Hamiltoniani C. Y. Yang, emend. X. C. Zhang & R. H. Jiang; Sect. Phlegmariurus; and Sect. Squarrosurus (Herter) X. C. Zhang & R. H. Jiang, comb. & stat. nov. We reduced the following taxon names to synonymies of various species of Phlegmariurus: Huperzia medogensis, Phlegmariurus austrosinicus, P. changii, P. nylamensis, P. cancellatus var. minor, P. qiongzhongensis, and P. shangsiensis.