BACKGROUND: A method is described that uses dilute phosphoric acid for wheat straw pretreatment and subsequent ethanol and fungal biomass production with the edible fungus Neurospora intermedia. Dilute phosphoric acid pretreatment of wheat straw was optimized at a laboratory scale, and the results were validated in a biorefinery demonstration plant for the first time. The various conditions for the dilute acid pretreatment include such factors as phosphoric acid concentrations (0.5-3.0% w/v), temperature (150-210 degrees C), and reaction time (5-20min). RESULTS: The optimal pretreatment conditions were determined as an acid concentration of 1.75% (w/v) at a temperature of 190 degrees C for 15 min, based on the maximum enzymatic digestibility with the minimum inhibitor release. The efficiency of enzymatic polysaccharide hydrolysis was 36% for untreated straw and 86% for straw pretreated with dilute phosphoric acid. Scale up of the pretreatment at a biorefinery demonstration plant improved the process, with the subsequent efficiency of polysaccharide hydrolysis being 95% of the theoretical maximum. Ethanol fermentation of enzymatically hydrolyzed wheat straw using N. intermedia showed an improvement in the ethanol yield from 29% (with untreated straw) to 94% (with dilute phosphoric acid pretreated straw) of the theoretical maximum. CONCLUSION: This study opens up an alternative strategy for the efficient use of wheat straw for the production of ethanol and edible fungal biomass in existing wheat-to-ethanol plants. (C) 2016 Society of Chemical Industry