A new geldanamycin (GDM) derivative was discovered and isolated from the fermentation broth of Streptomyces hygroscopicus 17997. Its chemical structure was elucidated as thiazinogeldanamycin by LC-MS, sulfur analysis, and NMR. The addition of cysteine to the fermentation medium significantly stimulated the production level of thiazinogeldanamycin, suggesting cysteine as a precursor of thiazinogeldanamycin production. Although showing a decreased cytotoxicity against HepG2 cancer cells, thiazinogeldanamycin exhibited an improved water solubility and photostability. Thiazinogeldanamycin may represent the first natural GDM derivative characterized so far that uses GDM as its precursor. Its appearance also clearly indicates that an appropriate end-point of fermentation is of critical importance for the maximal production of GDM by Streptomyces hygroscopicus 17997.