Final answer:
The parasitic fungus growing on rye and other grains that contains lysergic acid is Claviceps purpurea, which causes ergotism.
Step-by-step explanation:
The parasitic sac fungus that grows on rye and other grains and contains the hallucinogenic chemical lysergic acid is known as Claviceps purpurea. This fungus is responsible for the disease called ergotism, which has two forms: gangrenous and convulsive. Gangrenous ergotism leads to vasoconstriction and can result in gangrene, while convulsive ergotism targets the central nervous system, causing mania and hallucinations due to the presence of ergot toxin, an alkaloid similar to LSD.