A rhizobacterium with high antifungal activity was isolated from a potato field at Inneruulalik, South Greenland. Phylogenetic analysis based on multi locus sequence typing showed that the bacterium was affiliated with strains of Pseudomonas fluorescens. The bacterium, denoted as Pseudomonas fluorescens In5, inhibited in vitro a broad range of phytopathogenic fungi, and the antifungal activity increased with decreasing temperature. Microcosm experiments demonstrated that P. fluorescens In5 protected tomato seedlings from Rhizoctonia solani. Transposon mutagenesis showed that the major cause for the antifungal activity of P. fluorescens In5 was a novel non-ribosomal peptide synthase (NRPS) gene. In addition, transposon mutagenesis showed that P. fluorescens In5 also contained a putative quinoprotein glucose dehydrogenase gene, which was involved in growth inhibition of phytopathogenic fungi. Although P. fluorescens In5 contained the capacity to synthesize hydrogen cyanide, β-1,3-glucanase, protease, and chitinase, these did not seem to play a role in the in vitro and microcosm antifungal assays.