We seek to define more fully how Phanerochaete chrysosporium degrades its natural substrate, lignocellulose. This contribution concerns several relevant topics. Mineralisation of [14C]DHP, as a model for lignin degradation, showed that a set of genetically defined meiotically derived products of strain ME446 differed in their degradative ability and also that, under optimum conditions for mineralisation, extracellular lignin peroxidase activity was absent. Xylanolytic and xylosidase/beta(1-->3) glucanase activities are also described. The complexity of the CBHI gene family is described and differential splicing of a CBHI gene transcript is proposed. In contrast to the multiplicity of CHBI genes there is a single CBHII gene. PCR methods were developed to analyse differential gene expression on different substrates. We have also developed a transformation system involving a reporter construct for the analysis of CBHI promoter function.