We screened for oligotrophic microorganisms capable of decreasing the concentration of ytterbium (Yb), a representative of the heavy rare-earth elements, in a culture medium. From 476 strains of oligotrophic microorganisms (grown on 1/100 diluted nutrient agar) isolated from soil and river water samples, 5 strains capable of reducing the concentration of Yb in diluted nutrient broth containing 5 ppm Yb were selected. Among them, a strain capable of reducing the concentration of all rare-earth elements to a great extent was identified as Streptomyces sp. (strain YB-1). This strain produced redish-purple pigment(s) only in the presence of rare earths, but not in that of other metals. The pigment was extracted with ethyl acetate and purified by a series of column chromatography steps. From the results of structural analysis using ultraviolet or infrared absorption spectrometry and UC-NMR, the pigment was determined to be a kind of naphthoquinone similar to nanaomycin produced by a Streptomyces sp. These results suggested that rare earths might affect the physiological activity of this strain.