The review of the red algal theory for ancestry of Ascomycetes and Basidiomycetes published 10 years ago by the author is updated. Criticisms are answered and new data are discussed. The production of choline sulfate, lenthionine and lanosol are added to the biochemical similarities between red algae and higher fungi. Distribution of polyols is shown to be in favour of the origin of higher fungi from parasitic red algae. As predicted, NADP-linked glutamate dehydrogenase has been found in red algae, and additional reports of chitin in various algae have been published. New supporting data come from the ultrastructure of red algae: mitosis outside the Ceramiales and ultrastructure of vegetative cells and tetrasporocysts of Corallinaceae. On the other hand, the discovery of proplastids in Holmsella makes it less fungus-like. However, no decisive argument has yet been produced for or against the theory. Further light should be expected from protein and nucleic acid sequences. Promising partial sequences of cytochrome c have indeed been published for red algae but the published 5 S ribosomal RNA sequences have not proven relevant to the problem. Sequences of the slower-evolving large rRNA and cytochrome c of red algae could provide convincing evidence and are urgently needed.