Phellinus Linteus (Berkeley & M. A. Curtis) Teng (PL) is a medicinal mushroom that has been practiced in oriental countries for centuries to prevent ailments as diverse as gastroenteric dysfunction, diarrhea, haemorrhage and cancers. In an effort to translate the Asian traditional medicines into western-accepted therapies, scientists have demonstrated that the extracts from fruit-bodies or mycelium of PL not only stimulate the hormonal and cell-mediated immune function and quench the inflammatory reactions caused by a variety of stimuli, but also suppress the tumor growth and metastasis. Mounting evidence from different research groups has shown that PL induces apoptosis in a host of murine and human carcinomas without causing any measurable toxic effects to their normal counterparts. Recently, research has been focused on the anti-tumor effect of PL, and in particular, on its ability to enhance some conventional chemotherapeutic drugs. These studies suggest PL to be a promising candidate as an alternative anticancer agent or a synergizer for existing antitumor drugs. Hereinafter, we summarize the present progress in elucidating the mechanisms underlying the potency of PL and its anti-tumor function. The fractionation and identification of the biologically active components from PL are also briefly introduced.