A wild fungal strain of Aspergillus terreus, labeled as PM3, was isolated by using the Candida albicans bioassay and confirmed by 18S r DNA analyses. Lovastatin was produced by submerged and solid state fermentations. Of the 30 isolated fungal strains, 11 showed lovastatin production with Aspergillus terreus PM3 being the best with a yield of 240 mg/L at the 10th day of submerged fermentation. Carboxymethylcellulose had a stimulatory effect on lovastatin production. It restricted uncontrolled filamentous growth, induced pellet formation and, thereby, improved lovastatin yield. In solid state fermentation (SSF), of the agro wastes from five crops (bran of wheat and rice, husks of red gram and soybean, and green gram straw), wheat bran showed maximum lovastatin production (12.5 mg/g of dry substrate) at pH 7.1 and a temperature of 30±2°C. Development of a lovastatin production process based on wheat bran as a substrate in SSF is economically attractive as it is a cheap and readily available raw material in agriculture-based countries.