ent-Kaurene is the first cyclic diterpene intermediate of gibberellin biosynthesis in both plants and fungi. In plants, ent-kaurene is synthesized from geranylgeranyl diphosphate via copalyl diphosphate in a two-step cyclization catalyzed by copalyl diphosphate synthase and ent-kaurene synthase. A cell-free system of the fungus Phaeosphaeria sp. L487 converted labeled geranylgeranyl diphosphate to ent-kaurene. A cDNA fragment, which possibly encodes copalyl diphosphate synthase, was isolated by reverse transcription-polymerase chain reaction using degenerate primers based on the consensus motifs of plant enzymes. Translation of a full-length cDNA sequence isolated from the fungal cDNA library revealed an open reading frame for a 106-kDa polypeptide. The deduced amino acid sequence shared 24 and 21% identity with maize copalyl diphosphate synthase and pumpkin ent-kaurene synthase, respectively. A fusion protein produced by expression of the cDNA in Escherichia coli catalyzed the two-step cyclization of geranylgeranyl diphosphate to ent-kaurene. Amo-1618 completely inhibited the copalyl diphosphate synthase activity of the enzyme at 10(-6) M, whereas it did not inhibit the ent-kaurene synthase activity even at 10(-4) M. These results indicate that the fungus has a bifunctional diterpene cyclase that can convert geranylgeranyl diphosphate into ent-kaurene. They may be separate catalytic sites for the two cyclization reactions.