We report an approach to perform source connectivity analysis from MEG, and initially evaluate this approach to interictal MEG to localize epileptogenic foci and analyze interictal discharge propagations in patients with medically intractable epilepsy. Cortical activities were reconstructed from MEG using individual realistic geometry boundary element method head models. Directional connectivity among cortical regions of interest was then estimated using directed transfer function. The MEG source connectivity analysis method was implemented in the eConnectome software, which is open-source and freely available at http://econnectome.umn.edu . As an initial evaluation, the method was applied to study MEG interictal spikes from five epilepsy patients. Estimated primary epileptiform sources were consistent with surgically resected regions, suggesting the feasibility of using cortical source connectivity analysis from interictal MEG for potential localization of epileptiform activities.