Type and additional material of the trilobite genus Panderia Volborth, 1863 is described from sections and borings in the Ordovician of Sweden, Norway, Estonia, and Latvia. This work supports previous conclusions that Panderia is an illaenid but that it differs from all other members of the family Illaenidae to an extent that the new subfamily Panderinae subfam. nov. is established. The presence of a triangular rostral flange similar to that known for Stenopareia suggests that Panderinae is more closely related to the Illaeninae than to the Bumastinae. Panderia together with Dysplanus (Bumastinae) and Illaenus (Illaeninae) from the Lower Ordovician of Scandinavia, are among the earliest illaenids so far known and possible ancestors of Panderia are forms from the late Tremadoc of Öland and the Oslo region and early Arenig in Västergötland. The new genus Ottenbyaspis gen. nov. (type species Illaenus oriens Moberg & Segerberg, 1906) is created for these early forms which, however, are still insufficiently known to be assigned to any known family. Study of the ventral sutures of the Panderia species examined, shows that there is a development from the earliest forms, in which connective sutures and rostral plate are present (eu-ptychopariid type), to later forms in which the connective sutures are lacking and the ventral check and connecting doublure are fused (levisellid type). At the same time, migration to a ventro-marginal position of the transverse suture takes place in the youngest species. Twelve Panderia species are described of which nine are new.