Filamentous fungi owe powerful abilities for decomposition of the extensive plant material, lignocellulose, and thereby are indispensable for the Earth's carbon cycle, generation of soil humic matter and formation of soil fine structure. The filamentous wood-decaying fungi belong to the phyla Basidiomycota and Ascomycota, and are unique organisms specified to degradation of the xylem cell wall components (cellulose, hemicelluloses, lignins and extractives). The basidiomycetous wood-decaying fungi form brackets, caps or resupinaceous (corticioid) fruiting bodies when growing on wood for dissemination of their sexual basidiospores. In particular, the ability to decompose the aromatic lignin polymers in wood is mostly restricted to the white rot basidiomycetes. The white-rot decay of wood is possible due to secretion of organic acids, secondary metabolites, and oxidoreductive metalloenzymes, heme peroxidases and laccases, encoded by divergent gene families in these fungi. The brown rot basidiomycetes obviously depend more on a non-enzymatic strategy for decomposition of wood cellulose and modification of lignin. This review gives a current ecological, genomic, and protein functional and phylogenetic perspective of the wood and lignocellulose-decaying basidiomycetous fungi.