Decaying wood provides an important habitat for animals and forms a seed bed for many shade-intolerant, small-seeded plants, particularly Nothofagus. Using morphotyping and rDNA sequence analysis, we compared the ectomycorrhizal fungal community of isolated N. cunninghamii seedlings regenerating in decayed wood against that of mature tree roots in the forest floor soil. The /cortinarius, /russula-lactarius, and /laccaria were the most species-rich and abundant lineages in forest floor soil in Australian sites at Yarra, Victoria and Warra, Tasmania. On root tips of seedlings in dead wood, a subset of the forest floor taxa were prevalent among them species of /laccaria, /tomentella-thelephora, and /descolea, but other forest floor dominants were rare. Statistical analyses suggested that the fungal community differs between forest floor soil and dead wood at the level of both species and phylogenetic lineage. The fungal species colonizing isolated seedlings on decayed wood in austral forests were taxonomically dissimilar to the species dominating in similar habitats in Europe. We conclude that formation of a resupinate fruit body type on the underside of decayed wood is not necessarily related to preferential root colonization in decayed wood. Rather, biogeographic factors as well as differential dispersal and competitive abilities of fungal taxa are likely to play a key role in structuring the ectomycorrhizal fungal community on isolated seedlings in decaying wood.