Cellobiose dehydrogenase (CDH)-deficient strains of the basidiomycete Trametes versicolor were produced by transforming protoplasts of strain 52J with a plasmid carrying the T. versicolor cdh gene disrupted with a phleomycin resistance cassette. Of 143 phleomycin-resistant colonies analyzed, 3 did not produce measurable CDH during two successive two-week culture periods. Two of these mutants were shown to, lack functional CDH when grown in CDH induction medium. They biobleached and delignified industrial unbleached kraft pulp as efficiently as did wild-type T. versicolor, indicating that CDH is not required for the degradation and biobleaching of kraft lignin. The ability to degrade C-14-guaiacyl dehydrogenative polymerizate (synthetic lignin) also appeared to be unaffected. However, compared to the parent strain, all three mutants grew poorly on minimal agar with highly crystalline cellulose as the sole carbon source. This difference was not observed on non-crystalline, carbohydrates. All three mutants had a greatly decreased ability to colonize and degrade both seasoned and fresh native white birch wood, a natural substrate of T. versicolor. The dramatic decrease in T. versicolor 52J's ability to invade and grow on birch wood caused by the loss of its secreted CDH strongly suggests that this enzyme is essential to its wood invading and degrading niche in the forest ecosystem.