Water extract from spent mushroom substrates (SMS) of was utilized in decolorization of eight synthetic dyes and wastewater from a textile factory. High laccase activity was detected in the extract of (SMSE). The SMSE showed that decolorization rate was 34~93% after 24 h incubation without any mediator on eight dyes including Rit-blue and Rit-red used in fiber dyeing. Dye decolorization rate more than 90% was observed on bromophenol blue and remazol brilliant blue R (RBBR). Dye in textile wastewater was decolorized at room temperature after three days by addition of SMSE. The results suggest that biological decolorization of dyes using the SMSE can be used as environmental friendly materials.