Zoologists say that the bones which hang down from the mouth of the miniature fish make it unique among the 3,700 known species of carp-like fishes, which lost their jaw teeth 50 million years ago.
The fish, which measures just over 16 millimetres in length, was discovered near Mogaung in Burma, the only place in the world it has been found.
Scientists have described its features as "extraordinary" and believe it is one of the most interesting vertebrates to be identified in recent decades.
Named after Count Dracula, from the Bram Stoker's novel, it is the only one of its kind to have bones which project through the skin, looking like real teeth.
Colourless and with a largely tanslucent body, the Danionella dracula is also missing more than 40 bones which would normally be found in the Cypriniform group of carp-like fishes.
Dr Ralf Britz, a zoologist at the Natural History Museum, in London, said: "This fish is one of the most extraordinary vertebrates discovered in the last few decades.
"The teeth that Danionella dracula has are very surprising because none of the other 3,700 species in the Cypriniform group have any teeth in their jaws.
"In fact, they lost their jaw teeth about 50 million years ago in the Upper Eocene Period. Danionella dracula, however, evolved its own dracula-like teeth structures by growing them from the jaw bones rather than re-evolving jaw teeth."
His team worked with researchers from St Louis University in Missouri to analyse the fish.
Their findings are published in the Proceedings of the Royal Society B journal.