Three new ylangene-type sesquiterpenoids: dendronephthol A (7,13-dihydroxy-3,4-dihydro--ylang-5-one) (1), dendronephthol B (6,7,13-trihydroxy-3,4-dihydro--ylangene) (2), and dendronephthol C (6,7,13-trihydroxy--ylang-5-one) (3), together with two known compounds: dendronesterone A and cholesterol were isolated from the CHCl3 fraction of Red Sea soft coral Dendronephthya sp. (Nephtheidae). The structures of the new compounds were established on the basis of one- and two-dimensional NMR spectroscopic studies (1H, 13C, DEPT, COSY, HSQC, HMBC, and NOESY) as well as MS spectroscopy and by comparison of the spectral data with those of related known compounds. Compounds 1 and 3 showed cytotoxic activity against the murine lymphoma L5187Y cancer cell line with ED50 values of 8.4 and 6.8 µg/mL, respectively.