In addition to plants and animals, fungi are the other main group of macroscopic organisms present in the environment. Unlike plants, fungi are not photosynthetic, so like animals, they rely on consuming existing organic material as a source of energy. Fungi can be classified both by the form of their fruiting bodies, and where they are found growing. Some are plant pathogens, growing on living plants, causing harm to their hosts, but many grow on dead organic matter, and some form mycorrhizal associations with plants, where both the fungi and the host plants benefit. Some of these mycorrhizal relationships involve specific host species for specific fungi. There are estimated to be over 20,000 different fungi species in New Zealand, with only around a third formally identified. Marlborough supports a diverse variety of fungi with many colourful native fungi, as well as many unintentionally introduced species, some of which have become very invasive and displace native fungi. Fungi can be found in just about any habitat where there is available organic matter from alpine regions to the coast.
Ileodictyon cibarium commonly known as tūtae whetū in te reo Māori or basket fungus is a fungus native to New Zealand found in areas rich in organic matter such as leaf litter and mulch.