During an investigation of the chemistry of the endophytic actinobacterium Streptomyces albospinus RLe7, which was isolated from the roots of the Brazilian medicinal plant Lychnophora ericoides, three new natural products, (2R*,4S*)-2-((1'S*)-hydroxy-4'-methylpentyl)-4-(hydroxymethyl)butanolide (1), (3R*,4S*,5R*,6S*)-tetrahydro-4-hydroxy-3,5,6-trimethyl-2-pyranone (2), and 1-O-(phenylacetyl)glycerol (3), together with known secondary metabolites (S)-4-benzyl-3-oxo-3,4-dihydro-1H-pyrrolo[2,1-c][1,4]oxazine-6-carbaldehyde (4), (S)-4-isobutyl-3-oxo-3,4-dihydro-1H-pyrrolo[2,1-c][1,4]oxazine-6-carbaldehyde (5), and the diketopiperazines cyclo(l-Tyr-l-Pro) (6) and cyclo(l-Val-l-Pro) (7), were isolated. The role of isolated natural products in the interaction between S. albospinus RLe7 and the fungus Coniochaeta sp. FLe4, an endophyte from the same plant, was investigated. None of these isolated actinobacterial compounds were able to inhibit the fungus or induce the fungal red pigmentation observed when both endophytes interact. Further investigation using mass spectrometry approaches enabled identifying the well-known antifungal compound amphotericin B (9) as a microbial metabolite of S. albospinus RLe7. Finally, compound 9 was demonstrated as at least one of the agents responsible for both the antifungal activity and induction of red-pigmented fungal phenotype.