We have surveyed the variation of physical and chemical characteristics of aerobic and anaerobic outdoor fermentation of cotton wastes using for oyster mushroom cultivation. The inner temperature of cotton wastes fermented aerobically covered with thin cloth and setting pallet at bottom was higher than that of anaerobic fermented cotton wastes covered with P.E vinyl and the maximum temperature was 75 oC at 5th day after fermentation. pH of cotton wastes fermented aerobically was increased up to 8.9 after fermentation of 9~12 days, but that of anaerobically fermented was decreased up to 5.0. Total carbon content was decreased but total nitrogen content was increased when fermentation was in progress. Oxygen concentration of cotton wastes fermented aerobically was decreased until 6 days after fermentation but increased after 9 days of fermentation. Ammonia concentration of cotton wastes fermented aerobically and anaerobically was below 10 ppm and 20~85 ppm respectively. In anaerobic condition the cotton wastes was contaminated with mold (15~50%), where no contamination was found in aerobic condition during spawn running stage. Yields of mushroom grown on cotton wastes aerobically fermented for 6~9 days was 23.0~23.6 kg per 3.3 m ² area.