We describe a new species of a substrate-brooding Gymnogeophagus, based on coloration characters. The new species can be distinguished from the remaining substrate-brooding species in the genus by the unique pigmentation of the dorsal fin which consists of light blue, diagonal stripes over a red background in the spiny section and a combination of round, elliptic, and elongated bright blue spots over a red background in the soft section. It can be further distinguished from all other species of Gymnogeophagus by the following combination of characters: a discontinuous bright blue band above the upper lateral line in the humeral area, light blue roundish spots over a red to orange background on the anal fin, and conspicuous bright blue horizontal bands on body. The new species inhabits a wide range of freshwater habitats in the lower rio Uruguay basin, Rio de la Plata coastal drainages and Atlantic Ocean coastal drainages in Uruguay.