Oudemansiella mucida, an edible and medicinal mushrooms belonging to Tricholomataceae of Basidiomycota, has been known to produce antifungal substances to inhibit the mycelial growth and spore germination of the plant pathogenic fungi. To produce good amount of antifungal substances from culture media, the optimal culture conditions of O. mucida were investigated. The most favorable conditions for the mycelial growth were 25 oC and pH 5 in potato dextrose agar. The most favorable carbon and nitrogen sources promoting mycelial growth were maltose and calcium nitrate, respectively. The optimum C/N ratio was about 20 : 1 in case that 3% glucose was supplemented to the basal medium as a carbon source. The optimal mycelial growth of O. mucida was found in the Hennerberg medium. The crude extract from submerged culture of potato dextrose broth exhibited inhibition of mycelial growth of Colletotrichum acutatum, Botrytis cinerea and Pyricularia oryzae but, fungicidal activity is not good enough to compared with commercially available fungicides tested. Therefore, the antifungal substances extracted from submerged culture of O. mucida might have a potential to be used for biocontrol agent of fungal diseases of plants.