The variability within and among ectomycorrhizal species provides a substantial genetic resource and the potential to increase forest productivity and environmental sustainability. Two parallel and interacting approaches, classical and molecular genetics, are being developed to acquire the genetic information underpinning selection of improved ectomycorrhizal strains. Determining the genetic traits of the fungi which contribute to symbiosis and plant function are being followed using natural variability combined with classical and molecular genetic manipulations. Classical and molecular manipulations for breeding rely on key information including sexual and parasexual reproduction, postmeiotic nuclear behaviour, mating-types and vegetative incompatibility mechanisms. Progress in the manipulation of genomes of ectomycorrhizal fungi will depend on efficient methods for gene cloning and DNA transformation. Gene transfer into fungal cells have been shown to be successful and include treatment of protoplasts and intact mycelium with naked DNA in the presence of polyvalent cations, electroporation, and microbombardment. The merits and limitations of these methods are discussed. Using this technology the expression of foreign DNA, the functional analysis of fungal DNA sequences, as well as molecular exploitation for commercial purposes can be carried out. This review concentrates on these aspects of fungal molecular biology and discusses the applications of the experimental systems that are currently available to ectomycorrhizal fungi. As it is essential to be able to define the traits which a breeder is seeking to improve, availability of genetically defined strains that are isogenic for a character or differ only in one character and a thorough knowledge of the biochemistry of the symbiosis will be necessary before any genetic manipulation be carried out. Genetic variability of ectomycorrhizal strains has been assessed by DNA fingerprinting. This approach allows the evaluation of DNA variability and the exchange of genetic information in natural populations, the identification of species and isolates by DNA polymorphisms, and tracking the environmental fate of the introduced fungi to determine their survival, growth, and dissemination within the soil.