About Nystatin Polyene Antifungal. Mechanism of Action of Nystatin Nystatin is a fungicidal as well as a fungistatic drug. It has high affinity for ergosterol present in the fungal cell membrane and bind with it and they orients in such a way that micropore channel are formed and leads to efflux of ions, amino acid, sugar and other water soluble substances through this channel and results in cell disruption. Indications for Nystatin 1. Oral candidiasis 2. Cutaneous candidiasis 3. Mucocutaneous candidiasis 4. Monilial vaginitis 5. Monilial diarrhoea 6. Conjunctivitis 7. Corneal candidiasis 8. Candidiasis in immunocompromised patients