Nikkomycin Z is primarily used as an antifungal agent, particularly effective against fungi that contain chitin in their cell walls. It works by inhibiting chitin synthase, an enzyme crucial for chitin synthesis, thereby disrupting cell wall formation and leading to fungal cell death. This makes it valuable in treating fungal infections, especially those caused by pathogens like Candida and Aspergillus species. Additionally, it is studied for its potential in agricultural applications to control fungal diseases in crops. Research is also ongoing to explore its use in combination therapies to enhance efficacy against resistant fungal strains.