Antagonistic bacteria active against phytopathogenic fungi, Phytophthora capsici, Pythium ultimum, Rhizoctonia solani, Botrytis cinerea, and Fusarium oxysporum were isolated from greenhouse soils. An antifungal compound was extracted by ethyl acetate from acidified culture filtrate and purified through column chromatography and thin layer chromatography Activity-guided bioassay was followed throughout the purification steps using Pythium ultimum as a test organism. The purified antifungal compound was identified as phenylacetic acid (PAA) based on the data obtained from IR, EI/MS, ¹H-NMR, and ^(13)C-NMR. Two different isolates, which had vast differences in differential characteristics except 16S rDNA sequence homology, produced the same compound, phenylacetic acid. ED_(50) values of the phenylacetic acid against P. ultimum, P. capsici, R. solani, B. cinerea, and F. oxysporum were 45, 21, 318, 360, and 226 ppm, respectively.