Ceriporiopsis subvermispora is capable of decomposing lignin without penetration of enzymes into wood cell walls. To elucidate the mechanism of lignolysis at a site far from enzymes, peroxidation of low molecular mass compounds produced by this fungus was analyzed. C. subvermispora produced free 9, 12-octadecadienoic, 9-octadecenoic, 11-octadecenoic, hexadecanoic and octadecanoic acids, predominantly at an early stage of cultivation on wood meal cultures. In prolonged cultivation period after 2 weeks, the amount of intact fatty acids decreased with increasing organic hydroperoxide and TEARS production. These results suggest that lignin degradation by C. subvermispora is related to extracellular lipid peroxidation. (C) 1999 Published by Elsevier Science B.V. All rights reserved.