Abstract: To explore the practical application value and action mechanisms of Ag-antibiotic 702 against pathogenic fungi, the inhibition spectrum of Ag-antibiotic 702 was studied by measuring the mycelium growth rate of pathogenic fungi, and the effects of Ag-antibiotic 702 on the membrane permeability of Rhizoctonia solani, a typical pathogenic fungus, were investigated, with the variations of mycelium electrolyte leakage and protein, nucleic acid, and Mg²⁺ and K⁺ contents under the action of Ag-antibiotic 702 determined, and the effects of Ag-antibiotic 702 on the cell membrane ergosterol biosynthesis and ultramicrostructure observed. The results showed that the active products of Ag-antibiotic 702 had stronger inhibition effect on 13 test pathogens, among which, Sclerotinia sclerotiorum was most sensitive, with the EC₅₀ being 0.23 μg·mL^-1. As compared with the control, the relative electric conductivity of R. solani treated with Ag-antibiotic 702 was increased by 72.2%, the contents of protein, nucleic acid, and Mg²⁺ and K⁺ leaked from the R. solani cells were all increased, while the ergosterol content was decreased by 92.0%. The cell membrane outline was not clear, organelles were badly damaged, and vacuole appeared. It was suggested that the inhibition of ergosterol biosynthesis and the increase of membrane permeability could be the main action mechanisms of Ag-antibiotic 702 against pathogenic fungi.