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To determine the correct levels of the three process parameters identified as the most important for maximum production of antifungal antibiotic by the newly isolated strain of Streptomyces chattanoogensis MTCC 3423.The three independent variables, namely concentration of carbon source (glucose), nitrogen source (soybean meal) and temperature of incubation, were found to be the most important for production of antifungal antibiotic by the isolate Streptomyces chattanoogensis MTCC 3423 from a one-factor-at-a-time study. These variables were varied at three levels in 27 experiments using full factorial design. The results were analysed using statistical software for social sciences, SPSS (version 6·0). They indicated that the optimum combination of the three factors for maximum yield (263·63 U) of the antibiotic was concentration of carbon source (glucose) 5%, concentration of nitrogen source (soybean meal) 1% and temperature of incubation 30°C. The antifungal antibiotic activity of the isolate was estimated against Candida albicans by bioassay.The S. chattanoogensis MTCC 3423 isolate was found to yield a maximum of 263·63 IU Nystatin ml−1 medium by manipulating the three process parameters of glucose, soybean meal and temperature of incubation.As process optimization by single-dimensional search is laborious and time consuming, and does not guarantee determination of optimal conditions, an attempt was made to use a more practical full factorial method. Even though antifungal antibiotic treatment and resistance data have been analysed using SPSS software, there are no reports on antifungal antibiotic production using SPSS.