Production of lovastatioin is carried out by Penicillium funiculosum NCIM 1174 using industrial residues such as Green gram husk, Black gram husk, wheat bran and orange peel under solid state fermentation. Of these, wheat bran was found to be most suitable substrate with a yield of 5.3 mg/g of dry substrate. Standard graph is derived with pure lovastatin. The readings of the observed experiments with different substrates using the organism Penicilliun funiculosum were taken with the help of the U.V. spectrophotometer at 238nm. With the standard graph, the lovastatin produced (mg/g of dry substrate) is calculated. Lovastatin, is an inhibitor of HMG-CoA reductase. It lowers the concentration of cholesterol in the plasma of humans. The statins inhibit cholesterol synthesis in the body and that leads to reduction in blood cholesterol levels, which reduces the risk of Atherosclerosis and diseases caused by it.