The Colletotrichum lagenarium PKS1 gene encoding iterative type I polyketide synthase of 1,3,6,8-tetrahydroxynaphthalene (T4HN) was overexpressed in Aspergillus oryzae. SDS-PAGE analysis of the cell-free extract prepared from the transformant showed an intense band of 230000 which corresponded to the molecular weight of the deduced PKS1 protein. By using this cell-free extract, in vitro synthesis of T4HN was successfully confirmed as the first example of the fungal multi-aromatic ring polyketide synthase activity ever detected. To identify the starter unit for T4HN synthesis, (14)C-labeled acetyl CoA and/or (14)C-labeled malonyl CoA were used as substrates for T4HN synthase reaction. Observed was the incorporation of (14)C label into T4HN solely from malonyl CoA even in the absence of acetyl CoA and not from acetyl CoA. This in vitro result unambiguously identified that malonyl CoA serves as the starter as well as extender units in the formation of T4HN by fungal polyketide synthase PKS1.