Nostoc is a complex and tough genus to differentiate, and its morphological plasticity makes it taxonomically complicated. Its cryptic diversity and almost no distinguishable morphological characteristics make this genus incredibly heterogeneous to evaluate on taxonomic scales. The strain NOS, isolated from a eutrophic water body, is being described as a new genus Aliinostoc with the strain showing motile hormogonia with gas vesicles as an atypical feature, which is currently considered as the diacritical feature of the genus but should be subjected to critical evaluation in the near future. The phylogenetic placement of Aliinostoc along with some other related sequences of Nostoc clearly separated this clade from Nostoc sensu stricto with high bootstrap support and robust topology in all the methods tested, thus providing strong proof of the taxa being representative of a new genus which morphologically appears to be Nostoc-like. Subsequent phylogenetic assessment using the rbcL, psbA, rpoC1 and tufA genes was done with the aim of facilitating future multi-locus studies on the proposed genus for better taxonomic clarity and resolution. Folding of the 16S-23S internal transcribed spacer region and subsequent comparisons with members of the genera Nostoc, Anabaena, Aulosira, Cylindrospermum, Sphaerospermopsis, Raphidiopsis, Desmonostoc and Mojavia gave entirely new secondary structures for the D1-D1' and box-B helix. Clear and separate clustering from Nostoc sensu stricto supports the establishment of Aliinostoc gen. nov. with the type species being Aliinostoc morphoplasticum sp. nov. in accordance with the International Code of Nomenclature for algae, fungi and plants.