We provide keys, descriptions, illustrations, full synonymies, maps, and a list of specimens examined for species of Megalastrum found in Brazil, Paraguay, and Uruguay. Eighteen species are recognized, including seven new ones: M. albidum, M. brevipubens, M. indusiatum, M. littorale, M. organense, M. retrorsum, and M. substrigosum. The species occur primarily in the coastal mountains; none occur in Amazonia. The mountains of coastal Brazil are a center of endemism and diversity for the genus.