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Abstract: Internal fruit rot, caused by Fusarium lactis, is as an important disease of greenhouse sweet pepper. Fungal growth was studied microscopically during anthesis and fruit development. Hyphae were observed on the stigmatal surface one day after inoculation (DAI), and in the transmitting tissues of the style and inside the ovary at 5 and 6 DAI. Symptomless seeds from infected fruits yielded colonies of F. lactis when cultured axenically, and typical disease symptoms were observed when fruits were dissected at 45 DAI. Isolates of F. lactis and the related species F. proliferatum and F. verticillioides, which are also associated with internal fruit rot, produced the mycotoxins beauvericin, moniliformin and fumonisin B1 in various combinations, both in infected fruits and in vitro. These findings suggest that internal fruit rot is initiated through infection of the stigma and style during anthesis, and that mycotoxin contamination of infected fruit could pose a health concern.