A specific inhibitor of an enzyme might be useful for the analysis of certain pathogenic phenomena and also perhaps for the treatment of certain diseases. It was postulated that microorganisms because they produce catobolic enzymes may also produce inhibitors of these enzymes. The authors therefore started to search for enzyme inhibitors in microbial culture filtrates and, as reported in previous papers1^ leupeptins inhibiting plasmin, trypsin and papain were found in culture filtrates of various species of actinomycetes. In this paper, the isolation and properties of pepstatin, a pepsin inhibitor, are reported.