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A 4-year-old Iranian boy developed erythematous, itchy and annular lesion on his face. Microscopic examination of the scraped samples with 10 % potassium hydroxide (KOH) revealed fungal septate hyphae and arthroconidia. The etiological agent was found to be Microsporum gypseum in mycological examinations. Amplification and restriction digestion of the internal transcribed spacers (ITS) of rDNA was not helpful for identification, but in ITS sequencing the isolate showed 98 % homology to Microsporum incurvatum strain CBS 172.64. Empirical treatment of the patient with griseofulvin for 4 weeks was successful. Other than our isolate, the ITS1 sequences of 38 strains from related species were retrieved from GenBank and phylogenetic tree using maximum likelihood method was constructed. The case isolate clustered apart from other strains of M. incurvatum. Pairwise comparison of ITS1 showed intraspecies variations of 0-13 nucleotides among M. incurvatum strains and an extensive interspecies variation of 33-80 bp and remarkable interspecies size polymorphism between the three sister species in the M. gypseum complex. The high level of ITS1 intraspecific variation is suitable for species identification rather than phylogeographic analysis of M. gypseum complex.