Phoslactomycin B (PLM-B), a potent and selective inhibitor of serine threonine phosphatase is of interest for its antitumor, antifungal and antiviral activity. The objective of this study was to evaluate the stability of phoslactomycin B at various pH and temperature conditions. Phoslactomycin B was produced from the mutant strain NP1 of Streptomyces sp.HK-803 and was purified by semi-preparative HPLC . A study of PLM-B degradation was carried out in the pH range of 2-10 at 30ºC and 50°C using HPLC. The PLM-B decomposition was observed to exhibit a U-shaped pH profile and demonstrated both acid and base-catalyzed decomposition. The decomposition could be described by the equation kOBS = kH x 10-pH + kOH x 10 pH- 14 (kH = 45±7 M-1 h-1; kOH = 448± 73 M-1 h-1). PLM-B was found to be most stable at pH 6.63. The degradation products in both acidic and basic pH have been collected and analyzed. Under basic condition, mass spectroscopic analysis revealed addition of water and NMR was consistent with the major products being formed due to lactone ring opening and/or a Micheal type addition reaction. Under acidic condition MS revealed loss of water for all three compounds. NMR analysis of one product (product 8) was consistant with C9- C11 phosphorinane derivative of PLM-B. The remaining compounds were shown to be mixture of various dehydration products. The degradation products despite containing small structural changes to PLM-B lost all detectable levels of antifungal activity.