Western Southeast Asia is hosting one of the world's most diverse faunas, and one of the reasons for this huge diversity is the complex geologic past of the area, increasing the frequency of isolation and expansion events over evolutionary time scale. As an example case, the present study reveals the phylogeny and biogeographic history of the Paracanthocobitis zonalternans species complex, small benthic freshwater fish (Teleostei: Nemacheilidae) that are commonly occurring across western Southeast Asia (from central Myanmar through western and southern Thailand to northern Malaysia). The group is particularly interesting since it occurs in three biogeographic subdivisions (Indian, Indochinese, Malay/Sundaic) and across all of the major biogeographic barriers in the region. Basing on mitochondrial and nuclear sequence data of 93 samples from about 50 localities we found six major clades, most with exclusive geographic distribution. Divergence time dated the origin of the P. zonalternans species complex to early Miocene (17.8 MYA) and a biogeographic analysis identified the Tenasserim region as the ancestral region. From this region the fish spread during periods of lowered global sea level, particularly during late Miocene (11-8 MYA) northwards into all Burmese river basins and southwards into south Thailand and northern Malaysia. Besides lowered global sea level periods, local stream capture events allowed the complex to expand, e.g. into the Mae Klong basin. Strong fragmentations during periods with elevated sea level during the Pliocene and Pleistocene repeatedly restricted populations to refuges and shaped the observed major lineages. Our results document a higher diversity within the P. zonalternans species complex than formerly believed and a strong impact of global sea level on its evolutionary history. Low sea levels promoted dispersal and elevated sea levels fragmentation events. A very similar impact of sea level changes can be expected in all stationary fauna (freshwater and terrestrial) in all non-mountainous coastal regions worldwide.