Key factors affecting the oxidation of polycyclic aromatic hydrocarbons (PAH) by the white rot fungus, Phanerochaete chrysosporium, including Mn2+ concentrations on extracellular enzyme production and PAH source were investigated. P. chrysosporium acted synergistically with soil indigenous microorganisms in the oxidation of low molecular weight PAH (i.e. acenaphthene, fluorene, phenanthrene, fluoranthene and pyrene) in a soil-slurry, where oxidation was enhanced by up to 43% in the presence of fungus. However, limited oxidation occurred for high molecular weight PAH (i.e. chrysene, benzo(a)pyrene, dibenz(ah)anthracene and benzo(ghi)perylene). This was also the case for the oxidation of solid phase PAH (i.e. phenanthrene, pyrene and benzo(a)pyrene) when added in acetone to cultures, where less than 12% of the high molecular weight PAH benzo(a)pyrene was oxidized, compared to up to 84% for relatively soluble phenanthrene. In contrast, surfactant dissolved PAH pyrene and benzo(a)pyrene were efficiently oxidized (i.e. recovery was less than 16.3 and 0.35%, respectively). Results collectively show that PAH dissolution rate is the limiting factor in the oxidation of PAH from contaminated soil and when added in acetone. However, for the surfactant dissolved PAH, it could be the ionisation potential of the PAH, which is the key factor affecting PAH oxidation. The concentration of Mn2+ strongly regulated manganese peroxidase (MnP) production, and the presence of the lignin peroxidase (UP) and MnP was detected in cultures in the presence of surfactant dissolved PAH. Although an increase of Mn2+ concentration in culture medium is beneficial for the oxidation of surfactant dissolved PAH, it is not a pre-requisite. However, the presence of fungal biomass is a pre-requisite for the oxidation of surfactant dissolved pyrene as the biomass-free supernatant did not result in the oxidation of pyrene, despite the presence of extracellular enzyme activity.