A bacterial strain, B65-1, which showed strong antimicrobial activity, was isolated from Chungkook-Jang, a traditional Korean fermented-soybean food with antimicrobial properties. Based on carbon utilization pattern and partial 16S rRNA sequence analysis, the B65-1 strain was identified as Bacillus licheniformis. An antibiotic compound, active against bacteria and yeast such as Staphylococcus aureus, Escherichia coli, and Candida albicans, was isolated by various chromatographic procedures from culture filtrates of B. licheniformis B65-1. The purified antibiotic was identified to be phenylacetic acid, with the molecular formula C8H8O2 by analyses of EI-MS and NMR. The phenylacetic acid was detected in fermented soybean made with the strain B65-1 as a starter, but was not present in extracts of nonfermented soybean. Our results indicated that the phenylacetic acid produced by B. licheniformis during fermentation of soybean is one of the main compounds of antimicrobial activity of Chungkook-Jang.