This section is from the book "Our Edible Toadstools and Mushrooms and How to Distinguish Them", by W. Hamilton Gibson. Also available from Amazon: Our Edible Toadstools And Mushrooms And How To Distinguish Them.
A complete list of these exclusive habitats of fungi would well fill a large book, and might indeed almost involve the "index" of our botanies and zoologies, to say nothing of organic substances generally.
Plants, both living and dead, are favorite habitats for various species. The old stems of the common European nettle, according to Cooke, becomes the host of about thirty distinct species of the minute fungi. The toadstool itself is often the victim of other minor species. Insects are a frequent prey. The wasp succumbs to its special fungus parasite, which has formed a home within its body, and the common house-fly is seen in the toils of its similar enemy, as it hangs helpless by its proboscis upon the window-pane, enveloped in the winding-sheet of white mould from the fungus which has done its work within the insect's body. Spiders, locusts, ants, cicadae, and presumably all insects, are subject to similar fate from their especial parasitic fungi. The fungus thus often comes to the rescue of afflicted humanity in regulating the undue increase of insect pests. Here is a pretty, slender, orange, pointed mushroom growing in the moss. We pluck it from its bed, and it brings to the surface a chrysalis, with the dead moth distinctly seen within the cavity from which its roots spring. When we next come upon this species in the moss, we may confidently predict the discovery of this same species of chrysalis.
A similar long, slender fungus springs from the head of a caterpillar in New Zealand, and at length almost absorbs the insect's body. A similar species upon another caterpillar is carefully collected and desiccated by the Chinese, with whom it forms an important article in their native pharmacopoeia, and, moreover, it seems, may be perhaps appropriately included among the "edibles," for are we not assured by these expert and indiscriminate epicures of the chopsticks that this species "makes an excellent dressing for roast duck."