Algal and fungal microfossils recovered from the type area of Matanomadh Formation (Palaeocene), in the district of Kutch, Gujarat have been described. The assemblage comprises 20 genera and 27 species. Out of these, 10 genera and 13 species belong to algae and 10 genera and 14 species belong to fungi. Of the algae, Leioplanktona gen. nov. and Matanomadhia gen. nov. are quite common. Amongst the fungi, Phragmothyrites (Edw.) emend., Notothyrites Cook. (1947) and Inapertusporites (v.d. Ham.) Els. (1968) are frequently found. Microthyriacites Cook. (1947), Callimothallus Dil. (1965), Microthallites Dil. (1965) and Pseudosphaerialites Venk. & Kar (1969b) have been regarded here as junior synonyms of Phragmothyrites (Edw.) emended here. The present assemblage has been compared with the known algal and fungal assemblages from the Tertiaries of India. It has been inferred on the good percentage of microthyriaceous fungi that during Palaeocene, Matanomadh and the adjacent regions were having a tropical and humid climate favouring a luxuriant vegetation of pteridophytes and angiosperms.