Marine invertebrates are a promising source of novel natural products with biological activities. The phylum Bryozoa is relatively under-investigated in this context, although a number of compounds with medical potential has been discovered in recent years. Here, we report on the novel group of brominated metabolites from the bryozoan Terminoflustra membranaceatruncata, including analysis of biological activities of the tribrominated terminoflustrindole A (Cm-1) and the structures of the related dibrominated variants terminoflustrindoles B and C. Terminoflustrindole A was previously shown to have fungicidal properties. Although they vary by just one bromine group in each case from terminoflustrindole A, in this study, we report that terminoflustrindoles B and C exhibit no antimicrobial activity in the same assays. In addition to displaying antifungal activity, Terminoflustrindole A was also found to exhibit potent cytotoxic activity when tested against tumour cell lines. The gradient distribution of this compound within the bryozoan colony was demonstrated using LC-MS-analysis.