Lipophilic low molar-mass constituents in wood chips for the paper industry result in low quality pulp, pitch deposition, and effluent toxicity. New biotechnological solutions such as fungal pre-treatment of wood chips can reduce pitch problems. This laboratory-scale study focuses on the potential and limitations of a fungal bio-treatment of Norway spruce chips with the white-rot fungus Trametes versicolor. Different fungal treatment conditions were compared. A 4-week fungal treatment reduced the concentration of resin acids and triglycerides by 40% and 100%, respectively, but neither lowered the energy requirements of the TMP process nor significantly affected the morphological fiber characteristics and the physical pulp properties. The pre-treatment led to slightly poorer optical properties. The Trametes versicolor fungal treatment contributed to a less toxic effluent and improved the biodegradability. A treatment of 2-3 weeks appears optimal. (c) 2006 Elsevier Ltd. All rights reserved.