A new hermit crab species of the Paguridae, Dentalopagurus rutilocinctus sp. nov., is described from deep waters off Taiwan. The new species is closely allied to Dentalopagurus levii McLaughlin, 2007 in morphology and in choice of scaphopod shells as housing, but is distinguished by the armature on the carpus of the left cheliped, dactyli of the ambulatory legs, propodal rasp of the fourth pereopod, and the shape of the anterior lobe of the sixth thoracic sternite. The discovery of numerous specimens including females of the new species allows an emendation of the generic diagnosis of Dentalopagurus, which was known previously from only three males. The emended Dentalopagurus is more similar to Michelopagurus McLaughlin, 1997 than originally considered, with both sharing the characters of paired gonopores and paired first pleopods modified in females.