Like Atlantis, Edgar Cayce is also known for psychic readings on the lost continent of Lemuria. The Cayce readings refer to a lost continent in the Pacific by several names, but most often it is called Lemuria. Other names are Mu (the Motherland), and Zu; while Oz refers to modern-day Peru. Some of the names may refer to provinces of the continent, or to portions left after a major break-up of the land. Lemuria survives in the mythology of Hindus and Australian aborigines, Polynesians and Native Americans. According to Theosophy Lemurians had pliable, jelly-like bodies and slowly developed physicality. The first Lemurian sub-races were hermaphrodites who communicated by mental telepathy through a “third eye”. This atrophied after Lemuria's fall and became the pineal gland still found in modern humans. Finally, the ever-increasing density of matter brought about polarity in physicality, in the form of male and female, a process which instigated the era of sexual reproduction. Two distinct sexes emerged from one being. This marked the fall of man, as it is described, and since their physical split, male and female would strive to reunite as one body through physical union.

There was a soul (or an “entity”, as Cayce called it) among the Lemurian princesses who established the teachings of the Law of One which taught humans to practice unity consciousness and recognize their spiritual nature and their Higher (God) Self. Eventually, as this was more and more neglected and forgotten, destructive forces in Lemuria followed ego-based agendas based on the gratification of selfish motives due to (voluntary) separation from divine love.

According to Cayce, Lemuria, like Atlantis, was a highly developed civilization that collapsed around 80.000 BC. Survivors of the catastrophe fled to countries like China and Japan when Lemuria sank into the sea. The event is widely supported by Pacific area mythology from Australia to Arizona. From Hopi legend: "Down on the bottom of the seas lie all the proud cities, the flying patuwvotas, and the worldly treasures corrupted with evil ...". Faced with disaster, some people hid inside the earth while others escaped by crossing the ocean on reed rafts, using the islands as stepping-stones. The same story of escape to dry land appears in the Popul Vu epic of the Quiche Maya and the Modoc tribe near Mt. Shasta among many others. According to the Rosicrucians of San Jose, California, the disastrous cycle began with volcanic eruptions, earthquakes, and collapse of subterranean gas belts. Magnetic waves started moving around the globe, and Lemuria began to go under. Fortunately, there was time enough for small groups to rescue aspects of Lemuria's valuable wisdom, which was stored in crystals. Some refugees reached India and from there Mesopotamia and Egypt, while others migrated eastward on crude rafts to the Americas, forming the racial core of the earliest Indian tribes. In fact, California was home to one of history's oldest people: pure Lemurians who later became the California Indians. That would explain why America's oldest human artefacts were found on Santa Rosa Island off Santa Barbara, dated around 25,000 B.C. or even older. Some of the land area changed to what is now a portion of the Rocky Mountains - Arizona, New Mexico, Nevada and Utah.