The wood-decaying white-rot fungi produce sets of enzymes that completely degrade lignocellulose and therefore have potential applications in the production of cellulosic biofuel, especially from wood. White rot fungi including the model organism Phanerochaete chrysosporium generally grow better on hardwood than on softwood and degrade hardwood faster than softwood . Although less well studied, Phanerochaete carnosa is closely related to P. chrysosporium, but is distinguished by its isolation from softwood. The apparent preference of P. carnosa to grow on softwood may be due in part to its specific suite of lignocellulose-degrading enzymes or their relative expression levels. To identify the genes expressed by P. carosa during growth on wood fibre, this fungus was grown on four wood species (fir, pine, spruce, maple) and on a rich, soluble medium. Transcripts were sequenced using Illumina Solexa next generation sequencing technology, reads were aligned to a preliminary draft of the P. carnosa genome sequence, and sequence assemblies were annotated. Compared to the soluble medium, many genes known to be involved in wood degradation were upregulated during growth on wood, including 60 to 4000-fold upregulation of 6 lignin-degrading manganese peroxidases (MnP). In contrast, only 4 lignin peroxidases (LiP) were detected, with 0 to 1000-fold upregulation on wood. Given that softwood lignin has a higher phenolic density than hardwood lignin, and phenolic degradation is believed to inactivate LiP, the softwood-degrading P. carnosa may rely more heavily on MnP for lignin degradation. These results may contribute to the development of improved enzymatic processes for softwood degradation.