Two novel antibiotics, watasemycins A and B, were isolated from the fermentation broth of an actinomycete strain. The producing strain TP-A0597 was isolated from the seawater sample collected in Toyama Bay, Japan and identified as Streptomyces sp. based on the taxonomic study. The new antibiotics were obtained by solvent extraction and chromatographic purification and spectroscopic analyses identified that they were new analogs of thiazostatins. Watasemycin possesses a methyl group at 5'-position of thiazostatin instead of a hydrogen atom. Watasemycins showed antibiotic activity against Gram-positive and negative bacteria and yeast.