Mushrooms are rapidly becoming recognized as a promising source of novel proteins. Several proteins showing unique features have been isolated, including lectins, lignocellulolytic enzymes, protease inhibitors and hydrophobins. They can offer solutions to several medical and biotechnological problems such as microbial drug resistance, low crop yields, and demands for renewable energy. Large-scale production and industrial application of some fungal proteins proves their biotechnological potential and establishes higher fungi as a valuable, although relatively unexplored, source of unique proteins. This review provides the first comprehensive overview of known proteins from mushrooms, describes the process of acquiring a new bioactive protein, and provides an overview of current and anticipated applications of these proteins across biotechnology, medicine and agriculture.