 The species was first described by mycologists Alexander H. Smith and Wilhelm Solheim in 1953, on the basis of specimens collected in the Medicine Bow Mountains of Albany County, Wyoming. The specific epithet honors the early 20th-century American mycologist Lee Oras Overholts. It is commonly known as the "snowbank fairy helmet", or "fuzzy foot", although it shares the latter name with Tapinella atrotomentosa and Xeromphalina campanella. M. overholtsii has been given the Japanese name yukitsutsumikunugitake.
