Catabolism of amino acids is a central process in cellular nitrogen turnover, but only a few of the mechanisms involved have been described from basidiomycete fungi. This study identified one such mechanism, the l-amino acid oxidase (Lao1) enzyme of Hebeloma cylindrosporum, by 2D gel separation and MS. We determined genomic DNA sequences of lao1 and part of its upstream gene, a putative pyruvate decarboxylase (pdc2), and cloned the cDNA of lao1. The two genes were also identified and annotated from the genome of Laccaria bicolor. The lao1 and pdc2 gene structures were conserved between the two fungi. The intergenic region of L. bicolor possessed putative duplications not detected in H. cylindrosporum. Lao1 sequences possessed dinucleotide-binding motifs typical for flavoproteins. Lao1 was less than 23 % identical to Lao sequences described previously. Recombinant Lao1 of H. cylindrosporum was expressed in Escherichia coli, purified and refolded with SDS to gain catalytic activity. The enzyme possessed broad substrate specificity: 37 l-amino acids or derivatives served as effective substrates. The highest activities were recorded with l-glutamate, but positively charged and aromatic amino acids were also accepted. Michaelis constants for six amino acids varied from 0.5 to 6.7 mM. We have thus characterized a novel type of Lao-enzyme and its gene from the basidiomycete fungus H. cylindrosporum.