The edible straw mushroom, Volvariella volvacea, produces a multicomponent enzyme system consisting of endo-1,4--glucanase, cellobiohydrolase, and -glucosidase for the conversion of cellulose to glucose. The highest levels of endoglucanase and cellobiohydrolase were recorded in cultures containing microcrystalline cellulose (Avicel) or filter paper, while lower but detectable levels of activity were also produced on carboxymethyl cellulose, cotton wool, xylitol, or salicin. Biochemical analyses of different culture fractions in cultures exhibiting peak enzyme production revealed that most of the endoglucase was present either in the culture filtrate (45.8% of the total) or associated with the insoluble pellet fraction remaining after centrifugation of homogenized mycelia (32.6%). Cellobiohydrolase exhibited a similar distribution pattern, with 58.9% of the total enzyme present in culture filtrates and 31.0% associated with the pellet fraction. Conversely, most -glucosidase activity (63.9% of the total) was present in extracts of fungal mycelia whereas only 9.4% was detected in culture filtrates. The endoglucanase and -glucosidase distribution patterns were confirmed by confocal laser scanning microscopy combined with immunolabelling. Endoglucanase was shown to be largely cell wall associated or located extracellularly, with the highest concentrations being present in a region 1 to 2 µm wide immediately adjacent to the outer surface of (and possibly including) the hyphal wall and extending 60 to 70 µm from the hyphal tip. Immunofluorescence patterns indicated little if any intracellular endoglucanase. Most -glucosidase was located intracellularly in the apical area extending 60 to 70 µm below the hyphal tip, although enzyme was also evident in the extracellular region extending approximately 15 µm all around the hyphal tip and trailing back along the length of the hypha. The regions of the hypha located some distance from the apical region appeared to be devoid of intracellular -glucosidase, and the enzyme appears to be associated almost exclusively with, or located on the outside surface of, the hyphal wall.