The cell-free rumen fluid from cattle fed hay or grain exhibited the following biological characteristics which strongly suggest the presence of endotoxin or a toxic principle similar to endotoxin of gram-negative bacteria: proved lethal to mice when injected with actinomycin D; proved extremely lethal to chick embryo; induced biphasic pyogenic response in rabbits; enhanced susceptibility to bacterial infection in mice; evoked positive epinephrine skin reaction in rabbits and phenol-water or aqueous ether proved lethal to mice and chick embryos. A quantitative difference in concentrations of endotoxin was observed on LD50 in mice and chick embryos and response to the epinephrine skin test in rabbits. Cell-free rumen fluid of grain-fed cattle contained at least twice as much endotoxin as that of hay-fed cattle. Endotoxin in cell-free rumen fluid and in higher concentration in cattle fed grain than in those fed hay support the hypothesis that rumen bacterial endotoxins may participate in the pathogenesis of diseases associated with high grain feeding such as lactic acidosis and the sudden-death syndrome.