Efrotomycin, a modified polyketide antibiotic with utility as a growth permittant in the animal industry, is produced by Nocardia lactamdurans. A resting cell system has been developed to facilitate biosynthetic studies. Washed cells harvested from oil-based medium at 64 hours and resuspended in buffer produce up to 700 mg/ml efrotomycin in 60 hours when supplemented with a carbon source, optimally glucose. No evidence of carbon or nitrogen repression was observed. Productivity declines progressively with cell age but becomes less dependent on ongoing protein synthesis. The protein synthesis dependent and independent systems were used to study carbon utilization, incorporation of labeled precursors and to examine inhibitors of efrotomycin biosynthesis. A system derived from an efrotomycin non-producer was used to examine the glycosylation of the aglycone, aurodox, to efrotomycin through a monosaccharide form, 6'-deoxyallosyl aurodox.