Prescottia sibundoyensis S. Nowak, Kolan., Medina Tr. & Szlach. sp. nova (Orchidaceae) is described and illustrated from Colombia. It resembles P. lojana, but differs from it by hyaline-white, crisped-dentate leaf blade margins and prominent floral bracts. Prescottia sibundoyensis can also be distinguished by its long leaf petiole, truncate leaf base, translucent-white tepals, linear-oblanceolate petals, lip lacking prominent midvein and by having longer, somewhat twisted and upcurved basal auricles. A key to identification of Prescottia species from Colombia and Ecuador is provided.