3 alpha-Hydroxy-3,5-dihydromonacolin L acid (acid form), a new compound related to monacolin K (mevinolin), was isolated from the culture broth of a strain of Monascus ruber. The structure of the compound was determined by a combination of physical techniques. 4a,5-Dihydromonacolin L was converted to 3 alpha-hydroxy-3,5-dihydromonacolin L by a cell-free extract of M. ruber in the presence of molecular oxygen. The results demonstrate that the former is the direct precursor in the biosynthesis of the latter.