Although the amount of woodland in Caithness is very small, the Forestry Commission plantations do support a large number of fungi and, in a few years when recently planted forests become mature, there should be an even greater number.

Dunnet Forest is unusual in that the soil is very alkaline with a pH as high as 6.0. This, along with the strong NW winds, creates difficult conditions for coniferous trees which tend to prefer an acid soil.

Fungi are closely linked with the flowering plants which provide the material on which they subsist and therefore the fungal flora is greatly influenced by the type of vegetation that grows there. The humus formed by the rotting of needles and wood in a pine forest therefore produces an entirely different fungus flora from that of an oak or birch wood. The mycelium of certain fungi grows in such close association with the tree roots that neither the tree nor the fungus can live without the other, a state known as symbiosis.

Although fungi can be found throughout the year in Dunnet Forest, it is usually July before the fructification becomes particularly evident with the appearance of large numbers of Lactarius deliciosus, a species of milk cap on all the woodland paths. This species has a reddish-orange cap when young which eventually turns green when it becomes old. It is very easy to identify due to the discharge of a milk from the broken cap which rapidly turns a carrot colour. It is edible but not particularly tasty. Lactarius rufus, another species of milk cap, makes an appearance in August; this is present in even greater numbers, but seems to prefer the darker recesses of the wood. Anyone brave enough to penetrate these darker areas will find parts of the forest floor thickly covered with this species. It also produces a white milk when the cap is broken, but the milk remains white and has a very acrid taste, which makes it inedible.

Brightly-coloured members of the Russula family make an appearance, individually or in small groups, along the sides of the paths in August. They have caps varying in colour from red through to purple and violet and are easily identifiable by their brittle gills and granular flesh. Identification of the 70 or so species is not easy and demands a microscopic examination of the spores and observation of the reaction of the flesh to various chemicals. Russula queletii and Russula sardonia seem to predominate, the latter being easily identified by the flesh and gills becoming bright red on treatment with ammonium hydroxide solution. Most members of the genus are edible but some are very bitter and some, such as Russula emetica which is not common in Dunnet, can cause vomiting if eaten raw.

The genus Agaricus is represented by Agaricus silvicola, the wood mushroom. This species has whitish gills when young which turn black in older specimens. There can be no doubt about its identification as it smells strongly of aniseed. It is very good to eat but, unfortunately, is not yet present in large numbers.

The genus Boletaceae usually appear in large numbers in early September and there can be no difficulty in placing a fungus in this genus. Instead of gills they have a porous spongy tissue on the lower side of the cap. The genus includes some 45 species which are not easy to identify, but Boletus luteus cannot be mistaken for any other Boletus. It is the only species in Dunnet with a ring on the stem (the similar Boletus elegans is only found under larch) and it has a very shiny brown cap. Other Boletus are Boletus granulatus which has bright yellow flesh and Boletus cyanescens, the flesh of which turns bright blue when cut. All species of Boletus found in Dunnet Forest are edible but their slimy caps may not be to some people's liking.

The most common brown-spored genus present is Cortinarius, which has 300 different species that are very difficult to identify. When young, members of this genus have a cobweb-like veil covering the gills which disappears as they mature. There are a number of different species present in Dunnet, but they are difficult to identify with certainty without examination of the spores under a high-powered microscope.

'The family Tricholomataceae is well-represented in the early autumn, with some species surviving the early frosts and into the New Year. Tricholoma nudum (wood blewit), with its lilac stem and cap, may frequently be found covered with ice. The fruity smell makes this species easy to identify. Tricholoma saevum, also known as "blewits", appears in grassy areas in the wood and, like the wood blewit, is very good to eat. Tricholomopsis rutilans, with its purple cap and yellow gills, is also unmistakable.

Other members of the family Tricholomataceae which are common are members of the genus Clitocybe. This genus has gills which extend down the stipe and are often funnel-shaped. Clitocybe flaccida has a leathery brown cap with small dark spots on it and becomes common from August onwards. It can sometimes look similar to Hygrophoropsis aurantiaca,but the latter species has gills which are mostly forked. Both species are common in the darker parts of the wood.