This is the annual report for fiscal year 2011 by PNNL's Fungal Biotechnology research program to the sponsor, DOE's Office of Biomass Program. In FY 2011, PNNL's Fungal Biotechnology Team focused its research on improving its understanding of pentose utilization, carbon flux in fungi, and biosynthesis of hydrocarbon backbone compounds such as polyketides, fatty acids, and terpenes. A major highlight for the team was the publication of the comparative genomic analysis of two Aspergillus niger strains in the journal Genome Research.