Examining genetic diversity and lineage sorting of different genes in closely related species provide useful information for phylogenetic analyses and ultimately for understanding the origins of biodiversity. In this study, we examined inter- and intraspecific genetic variation in internal transcribed spacer 2 (ITS2), partial mitochondrial gene (mtMutS), and nuclear microsatellite flanking region in two closely related octocoral species (Heliopora coerulea, HC-A and HC-B). These species were recently identified in a population genetic study using microsatellite markers. The two species have different reproductive timing, which ecologically promotes lineage sorting. In this study, we examined whether species boundaries could be detected by the commonly used nuclear ITS2 and mtMutS, as well as by possibly neutral microsatellite flanking sequences. Haplotype network analysis of microsatellite flanking region revealed that a possible ancestral haplotype was still shared between the two species, indicating on-going lineage sorting. Haplotype network analysis of ITS2 and microsatellite flanking region revealed shared haplotypes between the two lineages. The two species shared fewer ITS2 sequences than microsatellite flanking region sequences. The almost fixed point mutation at the tip of helix 3 of ITS2 was not associated with the secondary structure or compensatory base changes (CBCs). The phylogenetic tree of ITS2 showed paraphyly and that of the microsatellite flanking region indicated that lineage sorting for the two species may be incomplete. Much higher intra- and inter-individual variation of ITS2 was observed in HC-B than that in HC-A, highlighting the importance of examining ITS2 from multiple individuals to estimate genetic diversity. The mitochondrial mtMutS gene sequences from 39 individuals, including both species collected from Japan and Taiwan, showed no variation because of slow rates of mitochondrial nucleotide substitution. This study suggests caution is warranted when reciprocal monophyly in a phylogenetic tree is used as the criterion for delimiting closely related octocoral species based on ITS2 or mtMtuS sequences. Detection of boundaries between closely related species requires multi-locus analysis, such as genetic admixture analysis using multiple individuals.