Peroxisome proliferator-activated receptors (PPARs), members of the nuclear hormone receptor (NHR) family, are ligand-activated transcription factors. Ligands (agonists) of PPARgamma have been shown to inhibit growth, promote terminal differentiation, and induce apoptosis in human breast tumor cells. A cell-based reporter assay was developed to examine extracts of terrestrial and marine organisms for the ability to activate PPARgamma. Bioassay-guided fractionation and isolation of an active extract from Pseudoceratina rhax yielded the known histone deacetylase (HDAC) inhibitor psammaplin A (1). Compound 1 activates PPARgamma in a MCF-7 cell-based reporter assay and induces apoptosis in human breast tumor cells in vitro. Molecular modeling studies suggest that 1 may interact with binding sites within the PPARgamma ligand-binding pocket. Therefore, in addition to its known effects on HDAC-mediated processes, activation of PPARgamma-regulated gene expression may play a role in the ability of 1 to induce apoptosis.