Pharmacology Action: Coriolus versicolor (CV) is a medicinal mushroom widely prescribed for the prophylaxis and treatment of cancer and infection in China. In recent years, it has been extensively demonstrated both preclinically and clinically that aqueous extracts obtained from CV display a wide array of biological activities, including stimulatory effects on different immune cells and inhibition of cancer growth. The growing popularity of aqueous CV extracts as an adjunct medical modality to conventional cancer therapies has generated substantial commercial interest in developing these extracts into consistent and efficacious oral proprietary products. While very limited information is available on the physical, chemical, and pharmacodynamic properties of the active principles present in these extracts, there has been sufficient scientific evidence to support the feasibility of developing at least some of these constituents into an evidence-based immunodulatory agent. In this article, the background, traditional usage, pharmacological activities, clinical effects, adverse reactions, active constituents, and regulatory aspects of CV are reviewed. Presented also in this review are the current uses and administration, potential drug interactions, and contraindication of aqueous extracts prepared from CV.