Erythropodium caribaeorum is an octocoral known for its production of novel anticancer agents, such as eleutherobin and its analogs as well as for its complex association with symbiotic dinoflagellates (Zooxanthellae; genus Symbiodimum). With this in mind, two sets of experiments were conducted using the extracts of the symbiotic algal cells from Erythropodium caribaeorum: an isolation and characterization of a novel tri-hydroxy sterol and a bioassay-guided isolation of three additional compounds. All compounds exhibit significant bioactivity against the following three cell lines: the human melanoma cell line M14P, the colon cancer cell line RKO and the breast cancer cell line MDA-MB-231. Importantly, this study reports the first isolation of a bioactive polyhydroxy sterol from a gorgonian's symbiont and further suggests that these algae represent a promising sustainable resource for drug discovery.