IT IS MY CONTENTION that mushrooms and fungi are far more crucial to the planet's ecological health than previously thought. We know that many mushrooms have powerful healing capabilities for humans, but what I've learned is that these organisms also appear to serve as primary healing agents for land and ecosystems. My study of fungi and mushrooms has demonstrated powerful new ways of rehabilitating degraded and polluted landscapes and enhancing soil fertility.

In some ways, we know less about the fungal domain today than our distant ancestors did. Ten thousand years ago we were all forest people, and there are many indications that our practical knowledge of mushrooms was far greater then. For example, the famous prehistoric iceman whose frozen remains were discovered high in the Alps on the border of Italy and Austria in 1991 had three wood conk mushrooms tethered to his right side. He probably used them for multiple purposes.

The mushrooms he prized sufficiently to carry with him on a long solo journey included a fragment of a birch polypore, which has very strong antibiotic properties. It's likely that he was using it to treat an infection or stomach disorder. He also carried some Fomes fomentarius, which can be hollowed out and used to carry fire because it burns only very slowly. This function would have been a matter of life and death in that era, allowing people and nomadic groups to travel without losing their ability to make fire. We've recently discovered that Fomes fomentarius seems to be effective against E. coli 0157, a potentially deadly bacterium often found in spoiled food. Although we've rediscovered this fact only in the past several years, it seems probable that the iceman's culture knew about Fomes fomentarius's antibacterial properties 5,300 years ago.

Mushrooms are widely represented in ancient art and sculpture throughout the world, and many species are still highly sought after as foods and medicines in a wide range of cultures. Our own culture in the United States may be the world's least mycophilic (mushroom friendly). Fortunately, however, we have become an increasingly multi-ethnic society; African, Asian, South American and Eastern and Western European immigrants, all much more mycophilic than Anglo-Americans, have brought their mushroom knowledge with them, to the great benefit of us all.

To understand the wondrous properties of many mushroom species, it's helpful to know some of the basics of how they grow. When we see a mushroom, we are seeing just the tip of the iceberg, so to speak. That mushroom is merely the fruiting body of a much more extensive organism, the mycelium, growing in the ground. Overlapping mosaics of mycelial mats actually permeate all the landmasses on the planet in the first two to four inches of soil. Such a mycelium may reside in the ground for years, and may, after many years, produce mushrooms.

The mushroom's emergence above ground is a major event in the life cycle of the mycelium, which otherwise grows invisibly in the soil. Like a fruit, the mushroom's function is reproductive: after mushrooms are formed, specialised cells on the gills or the pores produce spores that are jettisoned into space. When these spores are triggered into germination, they form a new mycelial mat.

Mycelia are remarkable phenomena. We have fossil records of mushrooms going back over ninety million years, to the earliest onset of the dinosaurs and vastly predating humans. Clearly they are highly successful life forms. Mycelia are everywhere, and they grow very quickly: they can travel from one edge of a room to the other in two to four weeks. A single cubic inch of soil can contain more than a mile of overlapping and interpenetrating cell networks, just one cell wide but extremely pervasive. In fact, mycelial mats constitute the largest organisms on the planet. The biggest one found to date extends over 2,200 acres. It's 165 football fields long, 3 feet deep, and 2,400 years old.

Along with bacteria, fungi are the primary recyclers and digesters of life. We now know that the complexity of the fungal kingdom gives soils the ability to respond to catastrophes, whether from a tornado, a hurricane, or somebody chipping wood or building a house. My research shows that the saprophytic fungi (those that promote decay) in particular seem to be running after human beings as quickly as they can, repairing the damage we cause to ecosystems - which appears to be one of their ecological functions. Until very recently, this capacity of mycelia for ecological repair had not been sufficiently understood or appreciated.

Scientists are increasingly realising that species they considered to be parasitic fungi are not blights on the forest, as was once thought. Such fungi actually build soil so the landscape can become a pedestal for greater ecological diversity. Many mushrooms play an absolutely critical role in maintaining forest biodiversity. For example, mycorrhizal species such as chanterelles, matsutake and porcini, which are symbiotic, grow in association with the root zones of higher plants. With very few exceptions, virtually all deciduous trees and shrubs have mycorrhizal mushroom hosts that sheathe their roots, increase their capacity to absorb water, extend their root zones, and protect them from disease vectors.

The absence of mycelia in soils indicates an imperilled habitat; conversely, mushrooms in your garden are a sign of a healthy ecosystem. The mycelium produces enzymes and acids and compounds with antibiotic properties that break down large organic complexes of molecules into simpler forms that plants can absorb. Mycelia are the great soil builders of our planet: they create habitats in which vegetables and other plants can grow. This characteristic of fungi is also what makes them so useful in ecological restoration, where the need often is to break down wastes and toxins.

I FIND FASCINATING structural similarities among mushroom mycelia, the brain's neural networks, and the internet. Mushroom mycelia seem to form a sort of planet-wide biological internet that transmits information. If a twig falls in the forest, to the mycelia it's like a pebble being thrown into a pond. When trees or plant materials fall and die, mycelial networks sense it almost instantaneously. This process has been proven in the laboratory; for instance, if a dead beetle is put into a Petri dish, mycelial mats growing on the opposite edge of the dish will move quickly toward that nutritional source, through means we don't understand. The mats are geographically separated from the food source by what for them is a great distance - hundreds of thousands of microns - yet are able to sense it, target it, and stream mycelium to it rapidly. In Japan, scientists recently showed that a slime mould can repeatedly navigate a maze in the most efficient manner to capture nutrient sources with the least amount of cellular production, suggesting a form of cellular intelligence.

About 465 million years ago, humans shared a common ancestry with fungi. We share about 30% of our genes with fungi, giving us more in common genetically with them than with any other kingdom. So perhaps it's not such a leap to speculate that mycelial networks might display a form of natural intelligence. It's certainly compelling that human neural structures, mushroom mycelia, and the model of the internet all share a very similar decentralised, networked architecture. There is no point-specific central location on the internet or in a mycelial mass where you can fatally harm the entire organism.

Whatever one may think about the prospect of fungal intelligence, the practical uses of mushrooms are indisputable. Dusty, my partner, and I have been working in three main areas: preserving potentially useful mushroom species and fungal biodiversity in general, which above all entails protecting habitats, especially forests; doing research on the medicinal uses of mushrooms; and devising new technologies that use some of the remarkable properties of the fungal realm to clean up pollution, enrich agricultural soils, and create environmentally benign pesticides.

WE LIVE IN THE Pacific Northwest in the US, an ideal place to work on biodiversity. Our home and laboratories are located at the base of the Olympic Peninsula of Washington State, south of Seattle, and we go into the rain forest frequently to find new mushroom species and ancestral strains of fungi with interesting properties. The forest is in a sense our church, and we're passionate about protecting it.

Because mushrooms can be cloned just from their spores, the 'wildcrafting' we do requires only a minuscule amount of physical material. (Cloning a mushroom is a natural process that does not involve genetic modification but simply takes tissue that will regrow in its natural expression.) We can walk into a grove of old-growth forest where there may be hundreds of mushrooms of one species, and our impact on the environment is minimal because we can select just one specimen, even just a small portion of one specimen. This procedure stands in direct contrast to the wild harvesting of mushrooms for profit, where people descend on chanterelle patches and harvest everything in sight.

We have four laboratories where our culture collection now houses several hundred species that are specific to our interests. After cloning specimens in the laboratory, we capture the phenotype - its genetic expression - and grow its mycelium, preserving the identical genetic individual. This way the strain is conserved, we hope forever, even if the habitat from which it came is tragically destroyed. The mycelium can be expanded into tons of mycomass. We grow about 250 strains in our culture library and have commercialised about twenty-five species.

In the area of medicine, mounting research is confirming the enormous potential for new curative compounds waiting to be found in the fungal realm, including entirely new classes of medicines. In light of the fact that penicillin comes from a mould, it's surprising that the pharmaceutical industry has not paid more attention to this field. What I want to focus on here, however, is the capacity of fungi to heal polluted sites and ecosystems, and how they can be used for insect control. Fungi can be great allies for rehabilitating environments and recreating sustainable biotic communities.

We've begun several such projects. One involves helping habitat recovery where people are cutting trees. We're demonstrating a technique of putting spore mass into chainsaw oil, so that when trees are cut, the oil - which mushroom mycelia love - will inoculate the stumps and accelerate the processes of decomposition and restoration. When the stumps are inoculated, the mycelium propagates rapidly. Its water-transporting properties increase resident moisture and attract all sorts of other micro-organisms, so that when the stumps and the trees are cut, they become an oasis of life instead of just drying out.

Another of our remediation projects using fungal technologies took place after a diesel fuel spill near Bellingham, Washington. We entered a state-sponsored pilot project with other bioremediation companies that were using standard bacterial and enzymatic processes to try to decontaminate the soil, which was saturated with oil and mounded up in piles about three feet high, forty feet long, and six to eight feet wide. Each company was given a soil module to work on. We inoculated ours with the mycelium of oyster mushrooms, and, like the other companies, we then covered it with a tarpaulin and came back about six weeks later.

As the tarpaulins were lifted from the other companies' modules, the odour of oil was overwhelming. Their piles remained starkly devoid of any life. When the tarpaulin came off ours, the mound was literally blanketed with oyster mushrooms, some as big as twelve inches in diameter. Hundreds of pounds of oyster mushrooms ultimately arose from this diesel pile. Subsequent laboratory tests found virtually no toxic oil residue in either the soil or the mushrooms, the result of enzymes and acids that the fungi release that break down such molecular complexes. This finding is especially significant because hydrocarbons are the basis for many other toxic industrial products, including most pesticides and herbicides.

But the really exciting part of the story is what happened next. After the mushrooms matured, flies came in and laid eggs in them. Maggots appeared, birds flew in, and other small mammals began to eat the mushrooms and the maggots. The birds and animals carried in seeds, and plants started growing. The mushrooms initiated a process that led to rapid habitat recovery. The polluted pile of dirt was transformed into an ecosphere of life. That's what these mushrooms are: keystone species that precipitate a catalytic, downstream reaction that invites other life forms. This is what Nature can do, but she needs a little help from us.

Oyster mushrooms are one of the prime candidates for breaking down petroleum-based and hydrocarbon-based contaminants and pesticides. They are by far the easiest of any mushrooms to grow, and they'll grow on almost anything: old chairs, soggy money, or coffee grounds. (They're also delicious and contain lovastatin, a cholesterol-lowering agent.)

For several years I've been working with Battelle Laboratories to test some of my strains for bioremediation. We've discovered that at least one strain was able to break down highly toxic materials, including VX, the notorious nerve-gas agent. VX contains a recalcitrant molecule that's very difficult to degrade and is the core constituent of other chemical warfare agents, which poses a huge problem because the US government has them in storage in great quantities. The only other method of disposal currently used is incineration, which of course disperses it into the air and could be quite dangerous. A laboratory experiment we conducted for the Department of Defense, reported in the British military-affairs magazine Jane's Defence Weekly, showed that by using mushrooms we were able to break down the VX in an unprecedented manner, and its transformation into a harmless substance occurred very quickly. Since this mushroom is native to old-growth forest, I see a strong argument for saving our primeval forests as a matter of national defence.

Benign insect control is another area of key interest. The mushroom Termitomyces is well known to native peoples in Africa as a delicious edible fungus cultivated by termites. They live in its mycelium, where they produce a beautiful honeycomb-like structure from which mushrooms later pop out. The termites are absolutely dependent on these fungi and have developed a close collaboration with them: an interspecies symbiosis. Insects and mushrooms share a close and ancient relationship, which we can adapt for human ends.

How we began experimenting with insect-targeting species is a funny story. Despite putting great care and resources into creating our state-of-the-art laboratories, Dusty and I haven't much attended to our house, which was being seriously damaged by carpenter ants. It was already in really bad shape, and after the Olympia earthquake in 2001, the roof tilted another two or three inches. A friend of mine said, "If all the carpenter ants stopped holding hands in your house, it would fall down!"

I had to do something, but I didn't want to use toxic pesticides, especially in my home. Instead I started researching whether there might be fungi that are non-toxic to humans and other mammals but would target specific insects such as carpenter ants. I learned that big corporations, including Monsanto and Dow, had spent millions to develop biological controls using fungi spores to kill termites and other insect pests. Their thinking was that fungi use spores to infect insects, which then become launching pads for dispersing more spores. But the corporate entomologists and mycologists had used a different paradigm and missed something that we found.

The problem with the conventional spore-delivery systems these corporations devised is that insects aren't stupid. Millennia of evolution have taught them to avoid danger when they sense it. Commercially designed bait traps house lethal spores that would kill insects coming into contact with them. But the insects sense this peril, and instead of going into the bait traps, they head in the other direction.

I felt that the key was to find the precise fungal species that has evolved as a parasite to a specific insect (and therefore has developed chemical compounds that attract that insect), and, crucially, to entice the insects into eating its mycellium in its pre-sporulating phase. So I focused on selecting strains that delay sporulation. My goal was to grow mycelium rather than spores. Experimenting in my house, I put out a dish with about fifty kernels of rice that contained mycelium prior to sporulation, which I wanted to occur later as a delayed reaction. The ants took away all the kernels of rice, and one week later we had no more carpenter ants in the house. Our house was thereafter free of carpenter ants because the mouldy carcasses repelled future invasions.

It turns out that prior to sporulation some fungi develop attractant properties specific to an insect species they have evolved to parasitise. The fungi entice the insects to ingest and carry them away, thus spreading the infection. The insects are beguiled into coming closer, whereupon they gorge themselves with mycelium and take some back into the nest, breaking it up to feed their queen and brood. Thus the workers effectively spread mycelium throughout the nest, which it then colonises. When sporulation does occur, the entire insect colony is wiped out.

If these techniques pan out, we might be able to replace many pesticides with totally benign myco-insecticides. But let me be clear about my own philosophy as a biologist and ecologist. The point is not to wage a war of annihilation against whole insect species. I seek to restore balance and equilibrium; it's absolutely crucial to protect the insect genome, which is essential to the web of life. The point of such a myco-technology is that it be highly targeted and localised. Insects, fungi, and microbes have coevolved successfully over great periods of time without wiping each other out, and all have much to teach us. The more we study these relationships, the more likely we are to find other highly practical applications.

We're trying to apply our approaches to a variety of other uses. For example, logging roads cause siltation in salmon beds, posing a major threat to salmon. We're working on a strategy of putting wood chips infused with myco-pesticidal species of fungi onto logging roads. As the fungi grow, they provide myco-filtration, catching the silt before it gets to streams and helping accelerate regeneration of the landscape. And eventually the logging roads would become perimeter barriers preventing insect plagues, such as beetle blights, from sweeping across the forest.

By partnering with fungi and harnessing their extraordinary powers, we are entering a new frontier of knowledge. I believe that the future of our planet and our health will increasingly depend on our working synergistically with other organisms. Fungi can provide us with a powerful array of tools for living in harmony within our ecosystems. o

Excerpted from Nature's Operating Instructions: The True Biotechnologies (A Bioneers Book), edited by Kenny Ausubel, published by Sierra Club Books and distributed by The University of California Press. © 2004 Collective Heritage Institute. To order in the UK, contact John Wiley & Sons, tel: 01243 843 291.

Paul Stamets is an author of many mushroom books, including most recently Medicinal Mushrooms.