Leucinostatin, an antimicrobial and antitumor antibiotic, was found to be cytotoxic to the murine leukemic cell line, L 1210. A complete inhibition of cell growth was achieved with 0.5 μg of the drug per ml. Leucinostatin showed membrane damage against L 1210 cells as well as mouse erythrocytes. L 1210 cells were partially protected from membrane damage by the addition of glucose to the medium. In contrast, no protective effect of glucose was observed with drug-induced hemolysis. The possible involvement of membrane lipid in the mechanism of action of leucinostatin is suggested by its action on liposomes. Liposomes prepared with lecithin, cholesterol, and an amphiphatic molecule, either dicetyl phosphate or stearylamine, were sensitive to leucinostatin and response to the drug was enhanced as the cholesterol level of liposomes was decreased. Changes in the net charge of the membrane did not show significant effects on leucinostatin action. In the presence of the antibiotic, on the other hand, protein synthesis in cells was markedly inhibited under conditions where the uptake of amino acids into an acid-soluble pool was not affected. However, leucinostatin did not exhibit any inhibitory effect on protein synthesis in a cell-free system from L 1210 cells. It is suggested that the inhibition of protein synthesis results from the initial interaction of the drug with membrane phospholipid.