Fungi are the great decomposers — moulds, yeasts and mushrooms. They are eukaryotes that feed in a very different way from animals or plants: they digest their food outside their bodies and absorb it.
Most fungi are multicellular (yeasts are the unicellular exception). Their body is made of fine threads called hyphae, which branch into a tangled network — the mycelium — that spreads through the food. The cell walls are made of chitin (not cellulose, as in plants). Fungi have no chlorophyll, so they cannot photosynthesise.
Fungi are heterotrophic and feed by absorption: the hyphae secrete digestive enzymes onto the food, breaking it down externally, and then absorb the small soluble products. This is extracellular digestion.
Fungi mostly reproduce by making vast numbers of spores (both asexually and sexually) which are spread by wind or water. In Rhizopus (bread mould), spores form inside a round sporangium on an upright hypha. Yeast reproduces by budding — a small bud grows off the parent and breaks away.
Helpful: as decomposers they recycle nutrients; yeast makes bread rise and ferments alcohol; Penicillium gives us the antibiotic penicillin and flavours cheese; mushrooms are food. Harmful: fungi cause plant diseases (rusts, smuts), spoil food, and infect humans (ringworm, athlete's foot); some produce toxins.