The California Athletic Commission said Gracie, 40, tested positive for a nandrolone metabolite steroid after beating Kazushi Sakuraba by unanimous decision in a June 2 match at the Los Angeles Memorial Coliseum.

Gracie will be suspended and fined up to $2,500 pending an appeal to the commission.

An e-mail left for Gracie and a call to commission Executive Officer Armando Garcia were not immediately returned.

The fight was promoted by Japan's Fighting and Entertainment Group. Mike Kogan, FEG event director, told the Los Angeles Times last night that Gracie was vacationing in Europe and was not immediately available for comment.

"I don't think it's a clear case yet," Kogan said. "There are false positives with this drug sometimes. I need to see the report."

Gracie, a Brazilian Jiu-Jitsu master whose first name is pronounced "Hoyce," helped start the Ultimate Fighting Championship in 1993 and saw it develop into a lucrative pay-per-view sport. Fighters use a combination of martial arts, boxing and wrestling.

Gracie has a 14-3-3 record. His fight was the feature match in a "Dynamite! USA" show at the Coliseum.

Earlier it was announced that two other fighters on the card also tested positive for drugs.

Tim Persey tested positive for methamphetamine. He was suspended for six months and fined $1,000 pending appeal.

Former NFL receiver Johnnie Morton tested positive for the steroid epitestosterone before his fight. He declined to take a post-fight drug test and was suspended indefinitely by the athletic commission.

It was the second time in a week that a fighter has been identified as testing positive for steroids.

The athletic commission said Wednesday that three-time champion James Toney and Danny Batchelder, his opponent in a heavyweight bout May 24 in San Jose, tested positive for steroids. They were suspended indefinitely.