Truncated iterative polyketide synthase-nonribosomal peptide synthetase (PKS-NRPS) megasynthases in which only the C domain is present are widespread in fungi, yet nearly all members have unknown functions. Bioinformatics analysis showed that the C domains of such PKS-C enzymes are noncanonical due to substitution at the second histidine in the active site HHxxxDG motif. Here, we used genome mining strategy to characterize a cryptic PKS-C hybrid from Talaromyces wortmanii and discovered the products are reduced long-chain polyketides amidated with a specific ω-amino acid 5-aminopentanoic acid (5PA). The wortmanamides resemble long-chain N-acyl-amide signaling lipids that target diverse receptors including GPCRs. The noncanonical C domain of this PKS-C hybrid was also demonstrated to be a bona fide condensation domain that specifically selects 5PA and catalyzes amidation to release polyketide chain.