Phialemonium obovatum was found to be the cause of nosocomial osteomyelitis in a 41-year-old man after sustaining a nonpenetrating injury to his lumbar and cervical region. Histologic examination of fragments of disk and bone from L3-4 hemilaminectomy showed multiple fragments of fibrocartilage with focal necrosis, chronic inflammation, and granulation tissue formation. Sections stained with Gomori's methenamine silver procedure showed multiple fungal elements in necrotic areas consisting of irregularly branched, hyaline septate hyphae having swollen cells, and occasional yeastlike cells. The use of Fontana-Masson silver stain showed the presence of melanin in cells walls and septa of the hyphae. Phialemonium obovatum was isolated when the ground tissue from disk and bone from L3-4 was cultured on biphasic brain-heart infusion medium. Colonies were moist, off-white to ochraceous with a characteristic green, diffusible pigment on the reverse side. The isolate grew well up to 40 degrees C. It formed characteristic adelophialides without conspicuous collarettes and basal septa and produced smooth, one-celled, hyaline, and obovate conidia.