A new antifungal antibiotic, named neo-enactin, was isolated from the cultured mycelia of Strain H 829-MY 10, identified as a new subspecies of Streptoverticillium and named Streptoverticillium olivoreticuli subsp. neoenacticus. The antibiotic was produced with a tetraene antifungal antibiotic, found mainly in the cultured mycelia of Strain H 829-MY 10 and it was extracted with methanol. The antibiotic is of a basic nature and it can be extracted with ethyl acetate at alkaline pH. Purification of neo-enactin was carried out by partition chromatography on cellulose and elution with ethyl acetate bufferized with phosphate buffer (pH 8.0). Neo-enactin shows strong antifungal activity and potentiates the antifungal activity of polyene antifungal antibiotics.