The horned toad assemblage, genus Megophrys sensu lato, currently includes three groups previously recognized as the genera Atympanophrys, Xenophrys and Megophrys sensu stricto. The taxonomic status and species composition of the three groups remain controversial due to conflicting phenotypic analyses and insufficient phylogenetic reconstruction; likewise, the position of the monotypic Borneophrys remains uncertain with respect to the horned toads. Further, the diversity of the horned toads remains poorly understood, especially for widespread species. Herein, we evaluate species-level diversity based on 45 of the 57 described species from throughout southern China, Southeast Asia and the Himalayas using Bayesian inference trees and the Generalized Mixed Yule Coalescent (GMYC) approach. We estimate the phylogeny using both mitochondrial and nuclear DNA data. Analyses reveal statistically significant mito-nuclear discordance. All analyses resolve paraphyly for horned toads involving multiple strongly supported clades. These clades correspond with geography. We resurrect the genera Atympanophrys and Xenophrys from the synonymy of Megophrys to eliminate paraphyly of Megophrys s.l. and to account for the morphological, molecular and biogeographic differences among these groups, but we also provide an alternative option. Our study suggests that Borneophrys is junior synonym of Megophrys sensu stricto. We provide an estimation of timeframe for the horned toads. The mitochondrial and nuclear trees indicate the presence of many putative undescribed species. Widespread species, such as Xenophrys major and X. minor, likely have dramatically underestimated diversity. The integration of morphological and molecular evidence can validate this discovery. Montane forest dynamics appear to play a significant role in driving diversification of horned toads.