Oyster mushroom (Pleurotus species) is commercially important in the world mushroom market. It is widely cultivated and consumed in different parts of the world. Many people admire the mushroom due to its taste, flavor, high nutritional values, and some medicinal properties. Pleurotus are generally rich in proteins with essential amino acids, physiologically important polysaccharides and essential fatty acids, dietary fibers, important minerals, and some vitamins. The presence of some bioactive substances, majorly polysaccharide-protein complex in the genus Pleurotus has been reported to confer some pharmacological potential such as antimicrobial, antioxidant, anticancer, anti-inflammation, anti-hypercholesterolemia, anti-hypertensive, anti-diabetic, hepato-protective and anti-allergic activities. The high nutritional value and potential medicinal uses suggest that the oyster mushrooms are pharmacologically important as functional foods.