A new chitinase inhibitor, named argifin, was isolated from the cultured broth of a fungal strain Gliocladium sp. FTD-0668. Argifin was purified from the cultured mycelium by the combination of cation exchange, anion exchange, adsorption, and gel filtration chromatographic methods. The structure of argifin was elucidated as cyclo(N(omega)-(N-methylcarbamoyl)-L-arginyl-N-methyl-L-phenylalan yl-beta-L-aspartyl-beta-L-aspartyl-D-alanyl) by NMR experiments and other spectroscopic analyses.