The extracellular lipase production of a sapwood-staining fungus, Ophiostoma piceae, grown in liquid media, was optimally active at pH 5.5 and 37°C. Although glucose, fructose, sucrose, starch and dextrin, as carbon sources for growth gave similar mycelial yields, which were higher than those obtained with arabinose, galactose or raffinose, the cells growing on those carbohydrates produced little extracellular lipase. However, both high biomass and lipase activity were obtained when plant oils (olive, soybean, corn, sunflower seed, sesame, cotton seed or peanut) were used as carbon sources. Among the nitrogen sources examined, Casamino acids gave the best growth, whereas (NH4)2SO4 gave the best lipase production. The highest lipase productivity seen was obtained in a medium with olive oil as carbon source and a combination of (NH4)2SO4and peptone as nitrogen source.