Neotyphodium sp. Lp1, an endophytic fungus from perennial ryegrass (Lolium perenne), produces the mycotoxin ergovaline in infected grasses, whereas a mutant in which a particular peptide synthetase gene is knocked out does not. We examined the impact of this knockout on other constituents of the ergot alkaloid pathway. Two simple lysergic acid amides, ergine and a previously undescribed amide, were eliminated by the knockout. Lysergic acid accumulated in the knockout endophyte, but quantities were only 13% of the total lysergic acid derivatives accumulated in the wild type. Concentrations of several clavines were not substantially affected. However, a novel clavine accumulated to higher concentrations in perennial ryegrass containing the knockout strain. The results indicate that production of simple lysergic acid amides requires the activity or products of the ergovaline-associated peptide synthetase and that the regulation of ergot alkaloid production is modified in response to the relatively late block in the pathway.