A well-defined material consisting of straw and a nitrogen source was composted in well-insulated containers. The C/N ratio was adjusted to about 30, and the moisture content to 70%. The temperature was monitored continuously. During the first month of composting samples were taken for fungal and chemical analysis. Compost samples were homogenised, washed, and 2 mm pieces of material were placed on agar media and incubated at 24 and 45°C. The Petri dishes were studied frequently and the germinating fungi were identified. The fungi developing during the compost process can be divided in two groups: One appearing before peak heating and another appearing after. Before peak heating there was dominated by species of: Pemcillium, Absidia, Trichurus, and Trichoderma when incubation was at 24°C, while Aspergillus fumigatus and Rhizomucor pusillus dominated when incubation was at 45°C. In samples taken after peak heating the thermophilic and thermotolerant species Thermomyces lanuginosus, Scytalidium thermophilum and Paecilomyces variotii dominated. Fruit bodies of Coprinus cinereus developed in great amounts during this phase.