BACKGROUND: Actinomycetes are gram positive bacteria with high G + C content in their DNA and are capable of producing variety of secondary metabolites. Many of these metabolites possess different biological activities and have the potential to be developed as therapeutic agents. The aim of the present study was to screen actinomycetes inhabiting halophilic environment such as Khewra salt mines present in Pakistan for cytotoxic and antitumor compounds RESULTS: An actiomycetes strain designated as Streptomyces sp. KML-2 was isolated from a saline soil of Khewra salt mines, Pakistan. The strain Streptomyces sp. KML-2 showed 84 % cytotoxic activity against larvae of Artemiasalina. In the screening phase, the strain exhibited significant antitumor activity with IC50 values of 12, 48 and 56 μg/ml against Hela, MDBK and Vero cell lines, respectively. After that extract from 20 l fermentation was used to purify secondary metabolites by several chromatographic techniques. Structure elucidation of isolated compounds revealed that it is highly stable producer of Chromomycin SA (1) and 1-(1H-indol-3-yl)-propane-1,2,3-triol (2). Both of the isolated compounds showed significant antitumor activity against Hela and MCF-7 cancer cell lines (IC50 values 8.9 and 7.8 μg/ ml against Hela; 12.6 and 0.97 μg/ml against MCF-7, respectively). The 16S rRNA gene sequence (1437 bp) of the strain confirm its identity (99 %) with Streptomyces griseus CONCLUSIONS: From this research work we were successful in isolating two potent antitumor compounds, Chromomycin SA and 1-(1H-indol-3-yl)-propane-1,2,3-triol from Streptomyces KML-2 strain, isolated from Khewra salt mine. As such this is the second report which confirms that S. griseus can produce Chromomycin SA without introducing any mutagenesis in its biosynthesizing gene cluster and isolated indole derivative is being reported first time from any member of actinomycetes group with having novel antitumor activity against Hela and MCF-7 cells Nucleotide sequences: Nucleotide sequence data reported are available in the GenBank database under the accession number: GenBank KJ009562