Microsporidia are obligate intracellular parasites that have long been considered to be primitive eukaryotes, both on the basis of morphological features and on the basis of molecular, mainly ribosomal RNA-based, phylogenies. However, accumulating sequence data and the use of more sophisticated tree construction methods now seem to suggest that microsporidia share a common origin with fungi and are therefore most probably just curious fungi. In this paper, we describe the current views on the phylogenetic position of the microsporidia and present additional evidence for a close relationship between fungi and microsporidia on the basis of reanalyzed ribosomal RNA data. In this respect, the importance of incorporating detailed knowledge of the substitution pattern of sequences into phylogenetic methods is discussed.