Epichloe species are fungal symbionts (endophytes) of grasses, many of whic
h are benign or mutualistic and have a balance of horizontal (contagious) a
nd vertical (seed-borne) transmission, whereas others mainly transmit horiz
ontally and are more antagonistic. Over the past eight years several Epichl
oe species have been described based largely on the biological species conc
ept. We conducted a multi-gene phylogenetic analysis to evaluate these endo
phytes as phylogenetic species, and thereby assess the relationship of phyl
ogenetic and biological species. Variation mainly in introns of genes encod
ing beta -tubulin (tub2), translation elongation factor 1-alpha: (tef1), an
d actin (act1) provided robust phylogenetic signal distinguishing the descr
ibed Epichloe species. Outgroup rooting split the genus into two major grou
ps. One group included most species with balanced transmission strategy, an
d in this group the phylogenetic and biological species concepts correspond
ed well. In contrast, these species concepts poorly corresponded for the ot
her group, the Epichloe typhina complex, with predominantly antagonistic, h
orizontally transmitted endophytes. me suggest that the balance of vertical
and horizontal transmission may promote ecological (host) specialization a
nd subsequent genetic isolation as mechanisms promoting speciation; whereas
strict horizontal transmission may select for broader host ranges, slow th
e development of genetically isolated species, and thereby increase lineage
sorting effects that cause conflicts between phylogenetic and biological s
pecies.