AbstractComplex correlated states emerging from many-body interactions between quasiparticles (electrons, excitons and phonons) are at the core of condensed matter physics and material science. In low-dimensional materials, quantum confinement affects the electronic, and subsequently, optical properties for these correlated states. Here, by combining photoluminescence, optical reflection measurements and ab initio theoretical calculations, we demonstrate an unconventional excitonic state and its bound phonon sideband in layered silicon diphosphide (SiP₂), where the bound electron–hole pair is composed of electrons confined within one-dimensional phosphorus–phosphorus chains and holes extended in two-dimensional SiP₂ layers. The excitonic state and emergent phonon sideband show linear dichroism and large energy redshifts with increasing temperature. Our ab initio many-body calculations confirm that the observed phonon sideband results from the correlated interaction between excitons and optical phonons. With these results, we propose layered SiP₂ as a platform for the study of excitonic physics and many-particle effects.