A new peptide antibiotic, cypemycin, with a molecular weight of 2,097 (M+H), was isolated from the culture broth of Streptomyces sp. OH-4156. The antibiotic possesses cytocidal activity against P388 leukemia cells in vitro at a concentration of 1.3 microgram/ml (IC50 values), and the antibiotic showed antimicrobial activities against Micrococcus luteus (MIC, 0.2 microgram/ml).