UNLABELLED: Members of the phylum are ubiquitous bacteria that play important roles in the global carbon and nitrogen cycle. In this study, we sampled the shallow-sea hydrothermal vent system close to Panarea Island, Italy, and analyzed the bacterial diversity in this habitat using a cultivation-independent amplicon sequencing approach. Motivated by the observed abundance of members of the phylum , we employed cultivation conditions that facilitate the enrichment of planctomycetes and isolated strain Pan216. This strain shows a rarely observed type of cell division-lateral budding. Based on 16S rRNA gene- and multi-locus sequence analyses, its phylogenetic position in the phylum appears vague. Strain Pan216 clustered between the different described families in the class . The novel isolate shares the highest sequence identity (85.4%) of the 16S rRNA gene with SVX8, indicating that this strain belongs to a novel family. In addition to its uncommon cell division mode, Pan216 cells are pill-shaped and covered by a putative outer surface layer. Genomic analyses of strain Pan216 revealed many giant genes, putative S-layer protein-encoding genes, and only a limited set of canonical cell division genes. Based on the results of the polyphasic analysis, we conclude that strain Pan216 constitutes a novel family within the phylum , for which we propose the name fam. nov. The novel species gen. nov., sp. nov. is represented by the type strain Pan216 (= DSM 100414 = CECT 9536). IMPORTANCE: We describe a novel family of the underrepresented bacterial phylum that divides by unusual lateral budding. Our strain is the only validly described species that uses this mode of cell division. Furthermore, it represents the only planctomycete outside of the anammox bacteria that has an S-layer-like structure. Taken together, the novel family shows a novel mechanism of cell division that could only be studied in this species.