Penicillium albobiverticillium is described as a new species belonging to the genus Penicillium, subgenus Biverticillium mainly due to the following characteristics: white conidial masses, acerose phialides, mononematous conidiophores with biverticillate penicillia, and a red soluble pigment on CYA, MEA, and MA. A spontaneous mutant obtained from a colony sector is also described. It produces a huge amount of blood-red, viscous exudate on MEA and an abundant red soluble pigment on CYA, MEA, and MA.