The diversity and ecology of fungi in general and macrofungi in particular, have beenrnlargely neglected in Ethiopia. In this context, this research aimed at providingrndocumentation and analysis of wild mushroom diversity along with thernethnomycological knowledge associated with wild edible and medicinal mushrooms.rnMushroom samples were collected from 48 plots (30 m Ã— 30 m) of three differentrnhabitat type (forest, grazing land and farming area) over three years (2012 â€“ 2014)rnfrom two study sites located in central (Welmera district) and Northwest (Mengerndistrict) parts of Ethiopia. Both morphological and molecular (ITS and partial LSUrnrDNA sequences) data were used for specimen identification. Maximum parsimonyrn(MP), Maximum likelihood (ML) and Bayesian posterior probabilities (PP) were usedrnfor phylogenetic analysis. A hierarchical cluster analysis, with statistical program Rrnwas used to identify macrofungal community type and synoptic values to indicaterndominant species in each community. Shannon-Wiener diversity index and Sorensen'srnsimilarity coefficient were used to assess species richness and evenness and tornmeasure similarities among communities. Ethnomycological data were collectedrnusing semi-structured interviews, focus group discussions, participant observation andrnwalk-in-the-woods methods. Ethnomycological knowledge held by differentrninformant categories was compared using One-way ANOVA and t-tests. Results inrnthis study showed, a total of 105 species belong to 23 families and 49 genera. Aboutrn95% of the species identified in this study are new records for Ethiopia. FamilyrnAgaricaceae (49), Lyophyllaceae (12), Tricholomataceae (9) and Psathyrellaceae (6)rnwere represented by more species which together accounted for 74.4% of the total. Thernobserved Shannon-Wiener diversity index (H'=3.76) of WFO showed the highestrnspecies diversity and the highest species richness (S= 62). Results of thernethnomycological study revealed 15 wild edible and medicinal mushroom speciesrnbelonging to 7 genera and 5 families that are used mainly as food in the MengernDistrict. Family Lyophyllaceae with 9 species (45%) was found to be best representedrnin the area. Ethnomycological knowledge is significantly influenced by gender, age, experience and litracy level parameters. Preference ranking exercise has indicatedrnTermitomyces schimperi was ranked first followed by T. letestui, T. microcarpus andrnT. eurhizus as the second, third and fourth preferred edible mushrooms respectively.rnThe phylogenetic relationship of 33 Ethiopian Agaricus collection with otherrnmembers of the genus from tropical/subtropical and temprate region was comparedrnbased on morphological and molecular (ITS 1+2 rDNA sequences) characteristics.rnMore than two-third of the Ethiopian Agaricus sequences examined in this study wasrndistributed amongst four of the eight well accepted/temprate sections of the subgenusrnAgaricus. The remaining six Ethiopian sequences group together with four distinctrnand exclusively tropical (African and/or Asian) clades with ML/MP/PP branchrnsupport 99/100/100, 100/100/100, 83/75/90, 85/75/90 respectively. None of thernEthiopian sequences in the dataset belongs to section Arvenses, Bivelares,rnChitonioides and Spissicaules. This study also shown that A. campestris, A.rncupreobrunneus, A.bohusii, A. purpurellus, A. subsaharianus and A. heterocystis,rnwhich are known to be edible are highly recommended for domestication andrncultivation because of their good nutritional and medicinal value. Generally, thernpresent study indicated that country is rich in wild mushroom diversity and associatedrnindigenous knowledge. However, anthropogenic factors together with loss ofrnindiginous knowledge and very poor conservation efforts threaten economically andrnecologically important mushrooms survival in the area. Thus, complementary in-siturnand ex-situ conservation strategy at national level is highly recommended.rnKey words: Welmera, Menge, wild mushrooms, diversity, molecular phylogeny,rntraditional knowledge