A new biocontrol formulation system was devised that does not require sterile conditions during preparation. It involves mixing vermiculite and powdered wheat bran with wet or dry fermentor biomass of Trichoderma spp. or Gliocladium virens, moistening with 0·05 Ν HCl, and drying the mixture. Before application to soil, the preparation (VBA-FB) is activated by re-moistening with 0·05 Ν HCl and incubated at room temperature for 2-3 days to stimulate development of young hyphae of the biocontrol fungus. Populations of biocontrol fungi proliferated to greater than 10 7 colony-forming units (cfu) per g of soil when activated VBA-FB was added to soil. In soil artificially infested with Rhizoctonia solani, seven isolates of the 14 studied added as VBA-FB reduced survival and 12 reduced saprophytic growth of the pathogen. Of these, two isolates of T. hamatum (TRI-4, Tm-23) and one of T. harzianum (Th-87) were the most effective. Preparations formulated with either wet or dry biomass effectively reduced pathogen survival, but activated VBA-FB was more effective than non-activated VBA-FB. Storage of VBA-FB at 25°C for 24 weeks before activation reduced viability of isolates considerably more than storage at 5°C for 24 weeks. In addition, VBA-FB stored at 5°C before activation more effectively reduced survival of R. solani than VBA-FB stored at 25° C. Survival of R. solani was reduced by activated VBA-FB applied to several soil types (sandy loam, sandy clay loam, clay). Some nitrogen fertilizers increased the efficacy of VBA-FB preparations of several isolates.