Cellulose is the most abundant biopolymer and renewable natural product in the biosphere. Cellulose degrading fungal strains play an important role in recycling of cellulosic materials. They have immense advantage in various industries to hydrolyze cellulosic substrates for production of various products. This study was thus aimed to isolate and characterize efficient cellulose degrading fungi from their common natural habitats. Decaying Acacia wood and industrial water effluent samples were used for isolation and screening of cellulolytic fungi. Both samples were serially diluted and cultured on cellulose basal medium (CBM) supplemented with 30 mg/L chloramphenicol as bactericidal agent. Cellulose degrading fungal isolates were selected based on their hydrolyzed zone after congo red dye stain. Among 13 initial isolates, four isolates (C, E, G, and H) were finally screened as the most efficient fungal isolates representing only degraded Acacia tree. These isolates were confirmed as Penicillium species (C), Apergillus terrus (G), Alternaria species (H) and Apergillus species (E). From this study, the decaying Acacia sample was found to be the best source for cellulolytic fungi than that of wastewater sample. Out of these isolates, the maximum zone of hydrolysis (51.33±1.53 mm) was obtained for 'isolate E', whereas the minimum zone of clearance (26.67±1.53 mm) was recorded for penicillium species. This study indicates the existence of potential cellulolytic fungal on decayed wood of Acacia. Hence, further molecular aided characterizations of the isolates and their enzymes are of paramount importance for their use for industrial purposes.