Wood-decay fungi are a group of fungi that play a crucial role in breaking down dead and decaying wood. They help recycle nutrients back into the ecosystem, making them essential for forest health. These fungi can be found on trees, logs, and stumps, where they decompose the cellulose and lignin in the wood. There are two main types of wood-decay fungi: brown rot fungi and white rot fungi. Brown rot fungi primarily break down cellulose, leaving behind a brown, crumbly residue, while white rot fungi decompose both cellulose and lignin, resulting in a lighter, more fibrous material.