This study was carried out to elucidate the mode of bacteriostatic property of xanthostatin (XS), a novel depsipeptide antibiotic with an N-acetylglycine side chain and selective antimicrobial activity against Xanthomonas spp. Two biotransformed XSs were isolated by the treatment of XS with the cell lysate of Xanthomonas campestris pv. citri, a solvent partition, preparative TLC, and HPLC. Structure determination of those two biotransformed XSs demonstrated deletion of the N-acetylglycine side chain. Noteworthily, they showed no antimicrobial activity against Xanthomonas spp. This result suggests that the N-acetylglycine side chain plays a critical role in the antimicrobial activity of XS, and that the bacteriostatic property of XS is due to susceptibility of the ester bond between the hexadepsipeptide nucleus and the N-acetylglycine side chain to hydrolytic enzyme(s) produced by Xanthomonas spp.