For the control of pathogenic microorganisms, Bacillus spp. were isolated from diseased pepper fruits in Korea. Among them, Bacillus sp. IUB158-03 showed high inhibitory effect on mycelial growth and spore germination of C. gloeosporioides and Botrytis cinerea. The strain was identified as B. amyloliquefaciens IUB158-03 based on its physiological, biochemical characteristics and Microlog analysis. The highest level of antifungal substances by B. amyloliquefaciens IUB158-03 were obtained when the bacterium was cultured in medium containing 2% soluble starch, 3% yeast extract, 0.5% tryptone, 0.5% $NH_4H_2PO_4$, and 1% NaCl (pH 6.0) at $25^{circ}C$ for 72 hrs. The antifungal substances were purified by butanol extraction, silica gel column chromatography, preparative thin layer chromatography, and high performance liquid chromatography. The purified antifungal substance was confirmed $R_f$ 0.27 by TLC. This substance exhibited antifungal activity against Fusarium solani, Rhizoctonia solani, Botrytis cineria, Alternata alternaria of plant pathogenic fungi and Trichophyton mentagrophytes, Epidermophyton floccosum, Cryptococcus neoformans of human pathogenic fungi.