Within the 1000 Fungal Genomes project, the genome of Dendrothele bispora, an inconspicuous, but phylogenetically very important species has been sequenced. Dendrothele belongs to the Agaricales, the biggest clade of mushroom forming fungi. The Agaricales mostly contains pileate-stipitate species, i.e. ones with cap and stalk (e.g. Amanita species). The genus Dendrothele is an exception from this, forming crust-like whitish, smooth patches on the bark of living trees. The phylogenetic position of Dendrothele in the middle of a clade of agaricoid mushrooms (Marasmiaceae) raises the question of whether this species's morphology reflects a long retained ancestral condition, or it is a reduced species evolved from agaricoid ancestors. The genome sequence of Dendrothele bispora will provide insights into the genome evolution of mushrooms in relation to the morphology of fruiting bodies and the reversibility of the evolution of complex fruiting body morphologies. Understanding of the genetic background of fruiting body formation can inform experiments to improve commercial mushroom production.