Facetotecta, the taxon established for 'y-larvae', is the last major crustacean group for which the adult stage remains unknown. With only 14 described nominal species, all in the genus Hansenocaris, their incompletely known life cycle, small size and dearth of molecular data have hampered assessments of their true species diversity. Based on field studies during which > 11 000 y-larvae were sampled, a new integrative approach for studying the taxonomy of y-larvae is outlined. It focuses on last-stage nauplii and y-cyprids and includes methods for rearing lecithotrophic y-larvae for documenting the morphology of specimens with live photomicroscopy and scanning electron microscopy (SEM) and for obtaining molecular systematic data. This new and integrated approach, whereby each single specimen provides multiple kinds of information, was implemented to describe Hansenocaris demodex sp. nov., a unique y-larval form with semi-vermiform nauplii that occurs in the waters of Okinawa (southern Japan) and Taiwan. A preliminary Facetotecta phylogeny shows remarkable congruence between the morphology of all newly sequenced y-larvae and molecular data (18S rDNA). Four independent clades are formed by H. demodex and three other types/species of y-larvae, together being the sister-group to a smaller clade including H. itoi and unnamed species from GenBank.