Saniwa ensidens is a pivotal taxon for understanding varanid evolution. A complete specimen of Saniwa ensidens was recently described, offering important new insights into the morphology of this taxon. We apply these new data to a broader-scale study of squamate relationships in order to understand the phylogenetic position of Saniwa ensidens and of varanids more generally. Among the other fossils included in our analysis were the Eocene taxon “Saniwa” feisti, the Miocene Varanus rusingensis, and the giant Pleistocene varanid Megalania prisca. We compare the phylogenetic hypothesis from our analysis of morphology with a recent molecular-based hypothesis and find numerous differences in the phylogenetic relationships within Varanus. We constrained our morphological data set to the phylogenetic pattern presented by the molecular data to further analyze the possible phylogenetic relationships of the fossil taxa. Our analyses show that Saniwa ensidens is the sister taxon to crown-group Varanus and that “Saniwa” feisti is a basal member of the varanid lineage, not closely related to Saniwa ensidens. Both Varanus rusingensis and Megalania prisca are members of the crown radiations of Varanus.