Molecular analysis of internal transcribed spacer DNA sequence data show that the fungus belongs to the section Purpurascentes, and groups in a clade with the agaric species C. submagellanicus (found in Tasmania).

The specific epithet caesibulga is derived from the Latin words caesius (lavender pale blue with grey tinge) and bulga (purse or bag) and refers to the bag-like shape of the fruit bodies.

[3] The fruit body of Thaxterogaster caesibulga is sequestrate, meaning that its spores are not forcibly discharged from the basidia, and it remains enclosed during all stages of development, even when mature.

Young fruit bodies have no distinctive or odor, but develop a pungent smell as they mature; their taste is somewhat farinaceous (similar to freshly ground flour).

It is found on the high eastern slopes of the New England Plateau in northern New South Wales, and in mixed forest near Mount Imlay in southern NSW.