The electrophoretic karyotype of the Chinese straw mushroom, Volvariella volvacea, was determined. The haploid strain V34 of V. volvacea has 15 chromosomes ranging in size from 1.4 to 5.1 Mb. No chromosomal polymorphism in terms of size and number was seen in either of two growth stages: vegetative mycelia or fruit-body gill tissues. DNA fingerprints were prepared by the arbitrarily- primed polymerase chain reaction. Those obtained from different stages during fruit-body morphogenesis were identical. However, variation in DNA fingerprints was evident in protoplast regenerants derived from the same vegetative mycelium. Thus the haploid mycelium of strain V34 is heterokaryotic but the bulk genotype is stable during fruit-body development. F1 and F2 progenies germinated from the haploid, uninucleate basidiospores from self-fertilized fruit bodies also regularly segregate a range of mycelial morphological variants as well as phenotypic variation revealed by DNA fingerprints. We overview the known mechanisms to generate genetic variation and propose a novel mechanism that could account for the 1:1 segregation ratio of self-fertile to self-sterile progeny regularly obtained from selfed Volvariella volvacea fruit bodies.