This paper presents the results of recent ethnomycological exploration in southern Thailand. Field observations, interviews and collection of fungi specimens were carried out primarily on two islands, Koh Samui and Koh Pha-ngan, situated in the western region of the Gulf of Siam. Some fieldwork was also conducted in the northern Thai province of Chiang Dao and in the southern Thai province of Surat Thani. During five separate excursions (1989-90), observations were made of occurrence, harvesting, use, and marketing of psychoactive fungi by local Thai natives (males and females, adults and children), foreign tourists, and German immigrants. The first records of psychoactive Psilocybe subcubensis and Copelandia dung fungi in Thailand are presented in this paper. These fungi exhibited intense bluing reactions when handled, indicating the presence of psilocybin and/or psilocin. Seven collections of Psilocybe cubensis (Earle) Singer and/or Psilocybe subcubensis Guzman and four collections of Copelandia sp. were harvested and sun-dried for herbarium deposit. These fungi are cultivated or occur spontaneously, often appearing in the decomposed manure of domesticated water buffalo (Bubalus bubalis) and at least three different species of cattle (Bos indicus, B. guarus, and B. sundaicus). The psychoactive fungi are cultivated in clandestine plots, both indoors and outdoors, in the uplands and villages on Koh Samui by both Thai natives and some foreigners. The sale of psychoactive fungi directly to tourists and to resort restaurants for use in edible food items such as omelettes and soups is discussed in detail. The preparation and sale of mushroom omelettes adulterated with artificial hallucinogens in some restaurants is also discussed. In addition, the marketing of items such as hand painted T-shirts, post cards, and posters bearing mushroom related motifs in Thailand is described.