The results of a cladistic analysis of Phasmida are presented. The study is based on an examination of the morphology of the exoskeleton of the adult female form and egg capsule. Thirty-two species of Phasmida were included along with representatives of Isoptera, Grylloblattodea, Embiidina, and Orthoptera: Ensifera and Caelifera. Hypotheses of Phasmida and Euphasmida monophyly were not falsified. Contrary to preconceived expectations, Orthomeria pandora (Westwood) and Dajaca monilicornis Redtenbacher formed a clade at the base of the Euphasmida tree, one node below Agathemera maculafulgens Camousseight which was presumed to be the most basal Euphasmida taxon. Areolatae, Anareolatae, Pseudophasmatidae, Bacillidae, Phasmatidae, Heteronemiidae, Pseudophasmatinae, Bacillinae, Cladomorphinae, Phasmatinae, Necrosciinae, Lonchodinae, sensu Bradley & Galil were not monophyletic, but Heteronemiinae were monophyletic. A review of the Phasmida fossil record is provided. No fossils of Timema Scudder are known. Euphasmida fossils include: Agathemera reclusa Scudder, Electrobaculum gracilis Sharov, Eophasma oregonense Sellick, Eophasma minor Sellick, Eophasmina manchesteri Sellick, Pseudoperla gracilipes Pictet, Pseudoperla lineata Pictet and various unclassified species from Grube Messel, Baltic amber, and Dominican Republic amber. The oldest documented Euphasmida fossils are 44-49 million years old; molecular clock dating underestimates the origin of the sister group Timema by at least 24 million years. The phasmid Lamponius nebulosus new species is described. It is endemic to the cloud forest habitat of the Luquillo Experimental Forest (altitude above 762m). Females look like sticks overgrown with lichens or moss. Host plants include Miconia sp. (Melastomataceae) and Guzmania sp. (Bromeliaceae) and possibly Tabebuia rigida Urban (Bignoniaceae) and Calycogonium squamulosum Cogniaux (Melastomataceae). The argument of Klass et al. that Mantophasmatodea is a new order of Insecta is inconclusive. Instead of a performing a cladistic analysis, these authors rely on subjective opinions of character polarity and possible autapomorphic characters to support their hypothesis.