Abstract. Host shifts of plant-feeding insects and parasites promote adaptational changes that may result in the formation of host races, an assumed intermediate stage in sympatric speciation. Here, we report on genetically differentiated and host-adapted races of the fungal endophyte Epichloë bromicola, which presumably emerged after a shift from the grass Bromus erectus to other Bromus hosts. Fungi of the genus Epichloë (Ascomycota) and related anamorphs of Neotyphodium are widespread endophytes of cool-season grasses. Sexually reproducing strains sterilize the host by formation of external fruiting structures (stromata), whereas asexual strains are asymptomatic and transmitted via seeds. In E. bromicola, strains infecting B. erectus are sexual, and strains from two woodland species, B. benekenii and B. ramosus, are asexual and seed transmitted. Analyses of amplified fragment length polymorphism fingerprinting and of intron sequences of the tub2 and tef1 genes of 26 isolates from the three Bromus hosts collected at natural sites in Switzerland and nearby France demonstrated that isolates are genetically differentiated according to their host, indicating that E. bromicola does not form a single, randomly mating population. Phylogenetic analyses of sequence data did not unambiguously resolve the exact origin of asexual E. bromicola strains, but it is likely they arose from within sexual populations on B. erectus.Incongruence of trees derived from different genes may have resulted from recombination at some time in the recent history of host strains. Reciprocal inoculations of host plant seedlings showed that asexual isolates from B. benekenii and B. ramosus were incapable of infecting B. erectus, whereas the sexual isolates from B. erectus retained the assumed ancestral trait of broad compatibility with Bromus host seedlings. Because all isolates were interfertile in experimental crosses, asexual strains may not be considered independent biological species. We suggest that isolates infecting B. benekenii and B. ramosus represent long-standing host races or incipient species that emerged after host shifts and that may evolve through host-mediated reproductive isolation toward independent species.