Plants of the genus Phyllanthus are commonly used in India, China and Korea for medicinal purposes. Although they are widely cultivated and marketed, there has been uncertainty about the efficacy of different species. A prerequisite of Good Agricultural Practice (GAP) is the authentication of relevant species, and this is now made unequivocal by applying DNA sequence tools. In this study the phylogenetic relationships among 18 Phyllanthus species found in China were investigated by DNA sequence analyses of the nuclear internal transcribed spacers (ITS1 and ITS2) along with the combined chloroplast ATPB and RBCL sequences. Cladistic analysis indicated that this genus is paraphyletic and strongly supports the notion that two problematic and confusing species, P. niruri and P. amarus, are two individual, albeit closely related, species. We have also developed an ITS rDNA-based multiplex PCR assay to differentiate three medicinally important species, P. amarus, P. niruri and P. urinaria.