Apistogramma megastoma sp. n. is described based on a total of 18 specimens from small forest streams in the Departamento Loreto, Peru, tributaries of the Río Jutai in the border area between Peru and Brazil south and west of the city of Leticia (Colombia) (near 04°12' S/70°06' W). Apistogramma megastoma sp. n., which may be confused only with A. barlowi, is distinguished from all other Apistogramma species by the combination of: noticeably disproportionately large head; exceptionally massive jaws, lyrate densely vertically banded caudal fn, extended dorsal-fn membranes in males; in aggressive females sooty head pattern and up to 8 series of small black dashes on thanks; small round caudal spot; and, exceptional for Apistogramma, maternal mouth-brooding behaviour. Distinguished from A. barlowi, by differences in colour pattern and by higher number of scale rows on cheeks. Apistogramma megastoma sp. n. inhabits in small fastflowing streams.