An unusual Phomopsis sp. was isolated as endophyte of Odontoglossum sp. (Orchidaceae), associated with a cloud forest in Northern Ecuador. This fungus produces a unique mixture of volatile organic compounds (VOCs) including sabinene (a monoterpene with a peppery odor) only previously known from higher plants. In addition, some of the other more abundant VOCs recorded by GC/MS in this organism were 1-butanol, 3-methyl; benzeneethanol; 1-propanol, 2-methyl and 2-propanone. The gases of Phomopsis sp. possess antifungal properties and an artificial mixture of the VOCs mimicked the antibiotic effects of this organism with the greatest bioactivity against a wide range of plant pathogenic test fungi including: Pythium, Phytophthora, Sclerotinia, Rhizoctonia, Fusarium, Botrytis, Verticillium, and Colletotrichum. The IC(50) values for the artificial gas mixture of Phomopsis sp. varied between 8 and 25.65 μl/mL. Proton transfer reaction-mass spectrometry monitored the concentration of VOCs emitted by Phomopsis sp. and yielded a total VOC concentration of ca. 18 ppmv in the head space at the seventh day of incubation at 23°C on PDA. As with many VOC-producing endophytes, this Phomopsis sp. did survive and grow in the presence of the inhibitory gases of Muscodor albus. A discussion is presented on the possible involvement of VOC production by the fungus and its role in the biology/ecology of the fungus/plant/environmental relationship.