A novel natural product structurally related to prephenate and arogenate was isolated from a mutant of Neurospora crassa. This D-beta-(1-carboxy-4-hydroxy-2,5-cyclohexadiene-1-yl)-lactic acid is herein given the trivial name of D-prephenyllactate. The new metabolite is even more acid labile than is prephenate and is quantitatively converted to phenyllactate at mildly acidic pH. The structure characterization of prephenyllactate was performed using spectroscopic techniques (ultraviolet, 1H NMR, 13C NMR, two-dimensional heteronuclear experiments and mass spectrometry). Circular dichroism proved conclusively the R configuration of the asymmetric carbon at C-8 of prephenyllactate. Enzymatic utilization of prephenyllactate by cyclohexadienyl dehydratase and by cyclohexadienyl dehydrogenase from Klebsiella pneumoniae was demonstrated.