ABSTRACTProteinase formation by the brown-rot fungusPostia placentawas studied to determine whether differences in proteolytic enzyme production could be correlated with the ability to decay wood. Strain MAD698, a standard test isolate ofP. placenta, formed higher levels of proteinases in the presence of organic, rather than inorganic, nitrogen. Strain ME20, an atypical monokaryon that causes less than 5% weight loss in wood in standardized decay tests, produced elevated levels of proteinase in the presence of inorganic nitrogen. Strain ME20 was also able to metabolize nitrate, a nitrogen source not readily used byP. placenta.Proteinase production was associated with the autolytic phase of growth in both MAD698 and ME20 and was localized in the colony centers. The proteinases had acidic pH optima indicative of aspartic proteinases. The ability of an isolate to cause weight loss in wood may be related to its proteinase regulation and nitrogen metabolism.