Inonotus obliquus BELYU1102 was selected from 12 different strains of Inonotus as a producer of immuno-stimulating polysaccharide. After a batch fermentation of I. obliquus BELYU1102 was carried out in a 300 l pilot vessel, endo-polysaccharide and exo-polysaccharide were both obtained. The proliferation activity of endo-polysaccharide for splenic cells was much higher than the activity of exo-polysaccharide. The active endo-polysaccharide was produced primarily during the late stationary phase. Enhanced proliferation and polyclonal IgM antibody production were observed in B cells by purified water-soluble endo-polysaccharide. Nitrite production and expression of IL-1beta, IL-6, TNF-alpha, and iNOS in macrophages were also enhanced. However, the endo-polysaccharide did not affect the proliferation of T cells, the IL-2 expression of Th1 cells, or the IL-4 expression of Th2 cells. The endo-polysaccharide showed activities similar to lipopolysaccharide (LPS) for B cells and macrophages, but there was a large difference between the two polysaccharides because cellular activations induced by endo-polysaccharide were not affected by polymyxin B, a specific inhibitor of LPS. The endo-polysaccharide appeared to have other cellular binding sites with TLR-4 and did not show a direct toxicity against tumor cells. However, indirect anti-cancer effects via immuno-stimulation were observed. The mycelial endo-polysaccharide of I. obliquus is a candidate for use as an immune response modifier. Submerged mycelial cultures are advantageous for industrial production of polysaccharides.