1. Pieces of secondary phloem of lilac planted on an agar medium inhibit the growth of Cytospora sp. Inhibition is weakest at the cambial, strongest at the oldest, face of the tissue. 2. Ether is a suitable solvent for extraction of the active substance; ethanol is less satisfactory, and none is obtained by cold aqueous extraction. Activity of the extracts is retained through autoclaving but not through dialysis. 3. Antifungal activity is located chiefly in extracts of the phloem of lilac; extracts of leaves and xylem are only slightly inhibitory to fungal growth. Phloem extracts from five other species of trees are less active than that of lilac. 4. Lilac-phloem extracts inhibit seed germination and root growth of cucumber. Lilac-phloem tissue explants which contain a high proportion of old cells proliferate less extensively in sterile culture than those consisting of young cells only. This parallels the distribution of antifungal activity in the tissue.