Trichoderma harzianum was cotransformed with genes encoding green fluorescent protein (GFP), -glucuronidase (GUS), and hygromycin B (hygB) resistance, using polyethylene glycol-mediated transformation. One cotransformant (ThzID1-M3) was mitotically stable for 6 months despite successive subculturing without selection pressure. ThzID1-M3 morphology was similar to that of the wild type; however, the mycelial growth rate on agar was reduced. ThzID1-M3 was formed into calcium alginate pellets and placed onto buried glass slides in a nonsterile soil, and its ability to grow, sporulate, and colonize sclerotia of Sclerotinia sclerotiorum was compared with that of the wild-type strain. Wild-type and transformant strains both colonized sclerotia at levels above those of indigenous Trichoderma spp. in untreated controls. There were no significant differences in colonization levels between wild-type and cotransformant strains; however, the presence of the GFP and GUS marker genes permitted differentiation of introduced Trichoderma from indigenous strains. GFP activity was a useful tool for nondestructive monitoring of the hyphal growth of the transformant in a natural soil. The green color of cotransformant hyphae was clearly visible with a UV epifluorescence microscope, while indigenous fungi in the same samples were barely visible. Green-fluorescing conidiophores and conidia were observed within the first 3 days of incubation in soil, and this was followed by the formation of terminal and intercalary chlamydospores and subsequent disintegration of older hyphal segments. Addition of 5-bromo-4-chloro-3-indolyl--D-glucuronic acid (X-Gluc) substrate to recovered glass slides confirmed the activity of GUS as well as GFP in soil. Our results suggest that cotransformation with GFP and GUS can provide a valuable tool for the detection and monitoring of specific strains of T. harzianum released into the soil.