Although diamond is the hardest material for cutting tools, poor thermal stability has limited its applications, especially at high temperatures. Simultaneous improvement of the hardness and thermal stability of diamond has long been desirable. According to the Hall-Petch effect, the hardness of diamond can be enhanced by nanostructuring (by means of nanograined and nanotwinned microstructures), as shown in previous studies. However, for well-sintered nanograined diamonds, the grain sizes are technically limited to 10-30 nm (ref. 3), with degraded thermal stability compared with that of natural diamond. Recent success in synthesizing nanotwinned cubic boron nitride (nt-cBN) with a twin thickness down to ∼3.8 nm makes it feasible to simultaneously achieve smaller nanosize, ultrahardness and superior thermal stability. At present, nanotwinned diamond (nt-diamond) has not been fabricated successfully through direct conversions of various carbon precursors (such as graphite, amorphous carbon, glassy carbon and C60). Here we report the direct synthesis of nt-diamond with an average twin thickness of ∼5 nm, using a precursor of onion carbon nanoparticles at high pressure and high temperature, and the observation of a new monoclinic crystalline form of diamond coexisting with nt-diamond. The pure synthetic bulk nt-diamond material shows unprecedented hardness and thermal stability, with Vickers hardness up to ∼200 GPa and an in-air oxidization temperature more than 200 °C higher than that of natural diamond. The creation of nanotwinned microstructures offers a general pathway for manufacturing new advanced carbon-based materials with exceptional thermal stability and mechanical properties.