Phanerochaete chrysosporium is considered the model fungus for white rot fungi. It is the first basidiomycete whose genome has been completely sequenced. Its importance lies in the fact that its enzymatic system comprises the major enzymes involved in lignin degradation. Lignin is a complex and highly recalcitrant compound that very few living organisms are capable of degrading naturally. On the other hand, the enzymes produced by P. chrysosporium are also powerful agents for the mineralization into CO2 and H2O of a wide range of aromatic compounds. However, these aromatic compounds are largely xenobiotic compounds with documented toxic effects on the environment and health. While the economic and environmental benefits of biodegradation with P. chrysosporium are well established, a thorough understanding of P. chrysosporium and its biodegradation processes is essential for successful biodegradation. Our aim of this critical literature review is to provide a concise and comprehensive insight of biodecomposition of organic substrate by P. chrysosporium.