This Report is a review of the literature of marine natural product chemistry for 1998. Earlier reports published in this journal cover the period from 1977 to December 1997. Compared with the research activity reported during 1997,1 the major difference in 1998 was reflected in a shift in interest from marine bacteria to fungi of marine origins. Once again the literature is dominated by reports of sponge metabolites, but the excessive speculation regarding possible microbial origins for these metabolites is gradually being replaced by experimental studies. Interest in the synthesis of marine natural products continues to rise and there have been many studies of the pharmacological and biochemical mechanisms of action of marine metabolites. The continued interest in marine natural products chemistry from outside of the field bodes well for its continued development.