Consumption of locoweeds, legumes endemic in arid western USA, has long been associated with locoism, a disease of ruminant animals. To explore the relationship between fungi associated with locoweed and locoweed toxicity, 11 locoweed populations from various sites in New Mexico were assessed for endophytic fungi. Endophytes were isolated from the leaves, stems, seeds, and flowers of eight populations of the toxic locoweeds Astragalus mollissimus, Oxytropis lambertii, and O. sericea. Fungal cultures grew very slowly and sporadically produced subcylindrical conidia with very dark transverse septa. All cultured endophytes produced the alkaloid swainsonine, which causes locoism. Endophyte-infected locoweed populations produced swainsonine, and the swainsonine level of endophyte strains in vitro was highly correlated with the swainsonine level of their host plant populations. The rDNA ITS from mycelia from four endophyte isolates and beta-tubulin encoding regions from mycelia of 18 fungal endophyte isolates were amplified using PCR and the nucleic acid sequences were analyzed. The nucleic acid sequences of the beta-tubulin encoding regions were essentially identical among all the endophytes regardless of plant genus and locations. Morphological evidence and sequence analysis of the ITS region suggest that the endophytes are most closely related to Embellisia. However, with the paucity of Embellisia species represented in sequence databases, precise taxonomic placement will await further study.