Extensive peatlands have been detected in Chile. Their maximum distribution corresponds to the territory known as 'Chilean Patagonia' (XI and XII Regions, south of latitude 42°S), where peculiar climatic, morphologic, geologic and vegetational environments were developed as a result of intense Quaternary glacial activity. This favoured the development of vegetational communities with predominance of Sphagnum genus, usually associated to valuable peat deposits, generated from slow and progressive decomposition of organic matter. Presently, there are two peat operations at work, both located near Punta Arenas. The whole of the magellanic peat production is used for champignon, fruit and flower nurseries, on two small farms located in Central Chile. The magellanic peats have natural humidity contents ranging between 90% and 95%; pH between 4.0 and 4.3; ash content between 0.5% and 4.1%; conductivity between 0.03 and 0.05 mS/cm. The energy content of ground peat with 30% of humidity, has values of 3.24 G Joule/m3 or 9.4 M Joule/kg. At present there is no rigorous estimate of Chile's peat reserves. They could be estimated in 15,400×106 m3, considering an area of 10,400 km2 and an average thickness of 1.5 m for the deposits. Future peat harvesting industry in Chile should undergo a steady growth over the next decade, emerging as a significant source of rural labour.