background: The application of mushrooms for health purposes has a long tradition and is very common in Asian countries. This trend is also becoming increasingly popular in the western hemisphere. However, mushrooms from European tradition are being treated in a restrained manner despite having significant potential as drugs or as sources of pure bioactive substances. objective: The present review provides an overview of the most important mushrooms used in European ethnomedical traditions and explores their pharmacological potential and the challenges for the development of new drugs from these sources of natural products. methods: Mushroom species were selected based on information in old herbal books and dispensaries, uninterrupted use and scientific literature in the PubMed database up to June 2019. results: Traditional experiences and modern studies have demonstrated that medical mushrooms used in European traditions have promising distinct pharmacological potential mediated through defined mechanisms (anti-tumour, anti-inflammatory, anti-oxidative and anti-bacterial). However, the number of modern chemical, biological and pharmacological studies remains relatively small, and some mushroom species have not been studied at all. Unfortunately, no valid clinical studies can be found. Unlike the case with herbal and fungal drugs from traditional Chinese medicine, we are far from comprehensively exploring this potential. conclusions: Mushrooms from traditional European medicine have the potential to be used in modern medicine. Considerable research, interdisciplinary collaboration, involvement of the pharmaceutical industry, time and money are necessary to explore this potential not only in the form of dietary supplements but also in the form of approved drugs.