In nature, wood-decaying fungi play an important role in global carbon and nitrogen cycling by promoting the bioconversion of organic matter. Wood-decaying fungi colonize and degrade wood by attacking cell components with enzymatic and non-enzymatic systems. Some fungal endophytes can become activate and express the wood-decay machinery under suitable conditions. It has been proposed that endophytic fungi are involved in triggering the development of early stages of wood decay. The understanding of fungal endophytes in wood biodegradation, including invasiveness, colonization strategies and degrading mechanisms, could help to understand forest carbon cycling. The potential uses of fungal endophytes could involve biopulping and wood pretreatment for bioethanol production, among others.