Rhabdastrella is a subtropical/tropical demosponge genus holding 18 species distributed predominantly in the Indo-Pacific region. Rhabdastrella is currently part of the Ancorinidae family (order Tetractinellida). However, previous molecular phylogenetic analyses and chemistry studies have repeatedly suggested that it has close evolutionary relationships with the genus Geodia, in the Geodiidae family (order Tetractinellida). This study provides new data from morphology, molecular markers (COI, 28S, and 18S) and sterols to re-evaluate this relationship. By revising several species of Rhabdastrella, including the type species of the genus Rhabdastrella distincta, this study strongly supports that this genus is polyphyletic and distributed within a group of Geodia, here informally called ‘Isops’. Moreover, Rhabdastrella and Geodia species from this group share unique C29-C30 sterols with additional alkyl groups in carbons 24 and 26, precursors of the 26-methylstigmastane (26-mes) sterane—a hypothesized ‘sponge biomarker’ identified in Neoproterozoic oils/rocks. We propose to formally reallocate Rhabdastrella to the Geodiidae, including a total of 14 species kept together for the time being until full revision of these species. As for other species, we propose (i) to move Rhabdastrella virgula to the genus Caminus, (ii) to reallocate four species of Rhabdastrella to the genus Geodia, and (iii) to move Jaspis coreana to the genus Rhabdastrella.