An association between fungal tremorgens and staggers in livestock has been documented recently in New Zealand (di Menna et af 1976; di Menna and Mantle 1978) and in Great Britain (Shreeve et al1978; Mantle et al1978). The tremorgens verruculogen and Penitrem A have been isolated from Peniciflium isolates in New Zealand (di Menna and Mantle 1978) and verruculogen and fumitremorgin A from Pennicillium isolates in Australia (Lanigan el af 1979). We are also able to report the presence of the latter tremorgens in cultures of Peniciflium janthineffum and P. paxifli isolated from soil samples collected during an outbreak of ryegrass staggers in lambs in the south east of South Australia in February 1978. This outbreak occurred in a mob of 160 eight-month-old Merino lambs which had been moved onto an 80 acre paddock carrying Demeter Fescue (cultivar of Festuca arundinaceae) and only a green pick of ryegrass (Lolium perenne). Approximately 50% of the lambs became staggery on driving after they had been on the paddock for 2 weeks. Affected lambs recovered spontaneously and no deaths occurred. Samples of ryegrass (including root and leaf material), top soil and faeces were submitted for fungal culture. Initially, aliquots of each sample were incubated in a humid chamber for 3 days at 25°C. A fine white mycelial growth occurred on all soil samples and on root samples. Two subcultures were made from each sample onto Sabourauds agar. A mixture of fungi including Mucor sp and Penicillium sp were subsequently recovered from one root sample and two soil samples. Two other samples of soil collected at the same time were examined at CSIRO, Parkville. These samples were inoculated onto Potato Dextrose Agar* supplemented with 2 g/l yeast extract. Peniciflium janthineffum (Biourge) and P. verruculosum (Peyronel) were isolated from one sample and P. paxilfi (Bainier) and P. verrucfosum from the other. The isolates of P. janrhineflum and P. paxifli were shown to be tremorgenic in mice by intraperitoneal injections of macerated mycelium. The isolate of P. janthineffum has subsequently been shown to produce the tremorgens fumitremorgin A and verruculogen, while that of P. paxifli has been shown to produce verruculogen only (Cockrum et a1 unpublished data). Other isolates of these 2 species associated with staggers outbreaks in Victoria, produced the same tremorgens (Lanigan el all979; Cockrum et af unpublished data). A relationship between the shortness of pasture and the incidence of ryegrass staggers has already been shown (Keogh 1973). It is probable that where the pasture is sparse (Healy 1967) or only a green pick is available sheep may ingest considerable quantities of soil and under such grazing conditions preformed toxins associated with soil fungi are also likely to be ingested.