ABSTRACT:-Some physiological effect of natural penicillin extract produced on cassava peel media by Penicillium chrysogenum PCL501 on E.coli infected Wistar rats were evaluated. Fermentation of P. chrysogenum PCL501 with cassava peels -an agro-waste-produced natural antibiotics. In vitro antibiotic activity of cassava peels culture extract was tested against two clinical bacterial isolates, namely, Bacillus subtilis, and Escherichia coli. The culture extract and standard drug (commercial Benzyl Penicillin) inhibited the growth B. subtilis and E. coli. Antibiotic activity of the culture extract was comparable with that of the standard drug. In vivo antibiotic action on Wistar Wistar rats infected with E. coli showed that the penicillin produced on cassava peel was potent as its administration leads to the recovery of the infected animals. Evaluation of biochemical indices of E. coli infected Wistar rats and treatment with extract confirms that the extract is a potent antibiotic. The haematological evaluation showed a significant decrease (p<0.05) in platelet count in animals administered with both the extract and reference drug. Cassava peels are indicated as a suitable and cheap carbon source for the production of penicillin by P. chrysogenum PCL501.