Latrunculins A (1) and B (2) are the major extractable toxins of the sponge Latrunculia magnifica, accounting for up to 0.35% of its dry weight. Their structures were elucidated using detailed spectral analysis (13C/1H NMR, MS, UV), minor chemical transformations (e.g., ketalization, ozonolysis), and X-ray crystallography of a derivative (compound 3). Latrunculin A (C22H31NO5S) features a 16-membered macrolide ring with a diene fragment, while latrunculin B (C20H29NO5S) has a 14-membered macrolide ring with a monoene fragment. Notably, the latrunculins are the first-known marine macrolides and natural products containing a 2-thiazolidinone moiety. They cause major alterations in specific cytoskeletal proteins. Geographic distribution analysis showed that L. magnifica from the Gulf of Eilat exclusively contains latrunculin B, while those from the Gulf of Suez (near Sharm El-Sheikh) exclusively contain latrunculin A, except for two collections with both compounds. The latrunculins are proposed to be polyketides biosynthesized from cysteine, and a retrosynthesis of the compounds is suggested.