Four new cycloheptapeptides, fuscasins A-D (1-4), were isolated from the marine sponge Phakellia fusca collected from the South China Sea. Their planar structures were fully characterized by spectroscopic methods, and the absolute configurations of amino acid residues were determined using the advanced Marfey's method. Structurally, 1 is a unique cycloheptapeptide with a backbone bearing a pyrrolidine-2,5-dione unit. Among the isolated compounds, 1 exhibited potent growth-inhibitory activity against HepG2 cells with an IC50 value of 4.6 μM, whereas it did not show apparent inhibitory effects against the other five human cancer cell lines, MCF-7, HeLa, NCI-H460, PC9, and SW480. Encouragingly, 1 exhibited no cytotoxicity against nonmalignant cells even with a concentration up to 100 μM. These findings suggest that 1 may display a selective inhibitory effect on the growth of HepG2 cells.