A monooxygenase gene was isolated from a biocontrol strain of Trichoderma hamatum and its role in biocontrol was investigated. The gene had homologues in other fungal genomes, but was not closely related to any fully characterised gene. The T. hamatum monooxygenase gene was expressed specifically in response to the plant pathogens Sclerotinia sclerotiorum, Sclerotinia minor and Sclerotium cepivorum, but not in response to Botrytis cinerea or T. hamatum. Expression of the gene did not occur until contact had been made between the two fungal species. Homologues in T. atroviride and T. virens showed similar expression patterns. Expression of the gene in response to S. sclerotiorum was influenced by pH, with a peak of expression at pH 4, and was subject to nitrogen catabolite repression. Disruption of the monooxygenase gene did not affect the growth or morphology of T. hamatum, but caused a decrease in its ability to inhibit the growth and sclerotial production of S. sclerotiorum. The monooxygenase gene had a role in the antagonistic activity of Trichoderma species against specific fungal plant pathogens and is therefore a potentially important factor in biocontrol by Trichoderma species.