KB21 is an isolate with broad spectrum antifungal activity against plant pathogenic fungi. Our aim was to produce and purify antifungal lipopeptides via fermentation using KB21 and verify their antifungal mechanism against pepper anthracnose. When the KB21 strain was cultured in tryptic soy broth medium, the antifungal activity against pepper anthracnose correlated with biosurfactant production. However, there was no antifungal activity when cultured in Luria-Bertani medium. KB21 filtrates showed the highest degree of inhibition of mycelia (91.1%) and spore germination (98.9%) of via increases in the biosurfactant levels. Using liquid chromatography-mass spectrometry (LC-MS) and LC-tandem MS (LC-MS/MS) analyses, the component with antifungal activity in the fermentation medium of the KB21 strain was determined to be the cyclic lipopeptide (CLP) antibiotic, iturin A. When the iturin fractions were applied to pepper fruits inoculated with conidia of , the lesion diameter and hyphal growth on the fruit were significantly suppressed. In addition, iturin CLP elevated the gene expression of , , and in the treatments both with and without following fungal pathogens. Overall, the results of this study show that iturin CLPs from KB21 may be potential biological control agents for plant fungal diseases.