Epichloae (Epichloë and Neotyphodium species; Clavicipitaceae) are fungi that live in systemic symbioses with cool-season grasses, and many produce alkaloids that are deterrent or toxic to herbivores. The epichloae colonize much of the aerial plant tissues, and most benignly colonize host seeds to transmit vertically. Of their four chemical classes of alkaloids, the ergot alkaloids and indole-diterpenes are active against mammals and insects, whereas peramine and lolines specifically affect insects. Comparative genomic analysis of Clavicipitaceae reveals a distinctive feature of the epichloae, namely, large repeat blocks in their alkaloid biosynthesis gene loci. Such repeat blocks can facilitate gene losses, mutations, and duplications, thus enhancing diversity of alkaloid structures within each class. We suggest that alkaloid diversification is selected especially in the vertically transmissible epichloae.
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