The biosynthetic gene cluster for the polyene antifungal antibiotic, 2'-O-methylmyxalamide D, was cloned from myxobacterium Cystobacter fuscus AJ-13278. A sequence analysis of the 12.8-kb region in the gene cluster revealed the presence of two type I polyketide synthase genes, mmxB and mmxC. The involvement of these two genes in the biosynthesis of 2'-O-methylmyxalamide D was confirmed by a gene disruption experiments. In addition, an S-adenosylmethionine-dependent methyltransferase gene (mmxM) was found downstream of the gene cluster and demonstrated, by a gene disruption analysis, to be responsible for converting the known unmethylated precursor, myxalamide D, into 2'-O-methylmyxalamide D.