Previous studies conducted in growth chambers had demonstrated the successful experimental inoculation of white spruce seedlings with anti-insectan toxin producing needle endophytes. Needles colonized with the rugulosin-producing endophyte 5WS22E1 (DAOM 229536) contained rugulosin in concentrations that impaired spruce budworm growth. Here we report experimental inoculations conducted under nursery conditions. To improve the reliability of detecting successful colonization, a polyclonal assay was developed for the target endophyte 5WS22E1. It was able to reliably detect the fungus in 500 ng subsamples of colonized needles. Seventeen months post-inoculation, 330 seedlings from 1235 inoculated were colonized. A random selection of 113 colonized seedlings was analyzed for rugulosin. Needles of most (90%) contained detectable concentrations of rugulosin. The range and distribution of the rugulosin concentrations was similar to that found in earlier tests done in growth chambers.