Two strains of subdivision 1 Acidobacteria, namely the pink-pigmented bacterium KA1T and the colorless isolate WH120T, were obtained from acidic Sphagnum peat and wood under decay by the white-rot fungus Hyploma fasciculare, respectively. Cells of these isolates are Gram-negative, non-motile, short rods, which are covered by large polysaccharide capsules and occur singly, in pairs, or in short chains. Strains KA1T and WH120T are strictly aerobic mesophiles that grow between 10 and 33єC, with an optimum at 22-28єC. Both isolates develop under acidic conditions, but strain WH120T is more acidophilic (pH growth range 3.5-6.4, optimum at 4.0-4.5) than strain KA1T (pH growth range 3.5-7.3, optimum at 5.0-5.5). The preferred growth substrates are sugars. In addition, the wood-derived isolate WH120T grows on oxalate, lactate and xylan, while the peat-inhabiting acidobacterium KA1T utilizes galacturonate, glucuronate and pectin. The major fatty acids are iso-C15:0 and iso-C17:1ω8c; the cells contain also significant amounts of 13, 16-dimethyl octacosanedioic acid. The quinone is MK-8. The DNA G+C content is 51.7-54.1 mol %. Strains KA1T and WH120T display 97.8% 16S rRNA gene sequence similarity to each other. The closest described relatives are Acidobacterium capsulatum and Telmatobacter bradus (93.4-94.3% 16S rRNA gene sequence similarity), which differ from strains KA1T and WH120T by the ability to grow under anoxic conditions, the absence of capsules, cell motility as well as by fatty acid composition. Based on these differences, we propose to classify the two novel isolates as belonging to a novel genus, Acidicapsa gen. nov., and two novel species, A. borealis sp. nov. for strain KA1T (=DSM 23886T = LMG 25897T = VKM B-2678T) and A. ligni sp. nov. for strain WH120T (=LMG 26244T = VKM B-2677T = NCCB 100371T).