Aerobic moderately thermophilic and thermophilic methane-oxidizing bacteria make a substantial contribution in the control of global warming through biological reduction of methane emissions and have a unique capability of utilizing methane as their sole carbon and energy source. Here, we report a novel moderately thermophilic Methylococcus-like Type Ib methanotroph recovered from an alkaline thermal spring (55.4 °C and pH 8.82) in the Ethiopian Rift Valley. The isolate, designated LS7-MC, most probably represents a novel species of a new genus in the family Methylococcaceae of the class Gammaproteobacteria. The 16S rRNA gene phylogeny indicated that strain LS7-MC is distantly related to the closest described relative, Methylococcus capsulatus (92.7% sequence identity). Growth was observed at temperatures of 30–60 °C (optimal, 51–55 °C), and the cells possessed Type I intracellular membrane (ICM). The comparison of the pmoA gene sequences showed that the strain was most closely related to M. capsulatus (87.8%). Soluble methane monooxygenase (sMMO) was not detected, signifying the biological oxidation process from methane to methanol by the particulate methane monooxygenase (pMMO). The other functional genes mxaF, cbbL and nifH were detected by PCR. To our knowledge, the new strain is the first isolated moderately thermophilic methanotroph from an alkaline thermal spring of the family Methylococcaceae. Furthermore, LS7-MC represents a previously unrecognized biological methane sink in thermal habitats, expanding our knowledge of its ecological role in methane cycling and aerobic methanotrophy.