A new neutral macrolide antibiotic named cytovaricin has been discovered in a screening program using Yoshida sarcoma cells in tissue culture. Its absolute structure, determined by X-ray analysis and the isolation of D-cymarose via acid hydrolysis, will be reported separately. This paper describes the isolation of cytovaricin from cultures of Streptomyces sp. No. H-230 (resembling Streptomyces diastatochromogenes, isolated from a soil sample collected in Yanai-shi, Yamaguchi Prefecture, Japan) and its characterization. Cytovaricin is a neutral compound with a melting point of 207°C, [α]² +8.10 (c 1.0, CHCl₂), and molecular formula C₄₇H₈₈O₁₈ (determined by FD mass spectroscopy and elementary analysis). It is easily soluble in dichloromethane, moderately soluble in ethyl acetate, chloroform, methanol and acetonitrile, slightly soluble in ethyl ether and water, but insoluble in hexane. It shows positive reactions to periodate-benzidine, iodine vapour and permanganate tests, and negative reactions to ninhydrin, Fehling and anthrone tests. Its UV absorption spectrum exhibits end absorption with a shoulder at 215 nm (ε 11,460), and it has a characteristic IR spectrum. Cytovaricin displays a distinct inhibition pattern against Yoshida sarcoma cells in tissue culture: it completely inhibits cell growth at 40 mcg/ml, allows some proliferation over a wide concentration range (10 mg–0.005 mcg/ml) but causes cell deformation and non-viability 3 days after inoculation, and slightly inhibits growth below 0.0002 mcg/ml. It completely inhibits the growth of Chlorella vulgaris at 250 mcg/ml (with partial inhibition over 125–0.6 mcg/ml) and shows inhibitory activity against some phytopathogenic fungi (e.g., Rhizoctonia solani with an MIC of 2 mcg/ml, Diaporthe citri with 250 mcg/ml), but is inactive against Gram-positive and Gram-negative bacteria. Mice tolerate an intraperitoneal dose of 1.56 mg/kg body weight, while 3.13 mg/kg is lethal.