FR901459, a product of the fungus Stachybotrys chartarum No. 19392, is a derivative of cyclosporin A (CsA) and a powerful immunosuppressant that binds cyclophilin. Recently, it was reported that CsA was effective against hepatitis C virus (HCV). However, FR901459 lacks active moieties, which are essential for synthesizing more potent and safer derivatives of this anti-HCV agent. Here we identified an actinomycete strain (designated 7887) that was capable of efficient bioconversion of FR901459. Structural elucidation of the isolated bioconversion products (1-7) revealed that compounds 1-4 were mono-hydroxylated at the position of 1-MeBmt or 9-MeLeu, whereas compounds 5-7 were bis-hydroxylated at both positions. The results of morphological and chemical characterization, as well as phylogenetic analysis of 16S ribosomal DNA (rDNA), suggested that strain 7887 belonged to the genus Lentzea. Comparison of the FR901459 conversion activity of strain 7887 with several other Lentzea strains revealed that although all examined strains metabolized FR901459, strain 7887 had a characteristic profile with respect to bioconversion products. Taken together, these findings suggest that strain 7887 can be used to derivative FR901459 to produce a chemical template for further chemical modifications that may provide more effective and safer anti-HCV drugs.