Depending on their stage of development, the tawny-brown mushroom caps may range in shape from oval to bell-shaped to convex, and reach diameters up to 3 cm (1+1⁄4 in).

The caps, marked with fine radial or linear grooves that extend nearly to the center, rest atop whitish stipes up to 10 cm (4 in) long.

A few hours after collection, the gills will begin to slowly dissolve into a black, inky, spore-laden liquid—an enzymatic process called autodigestion or deliquescence.

The species was first described scientifically by French botanist Jean Baptiste François Pierre Bulliard in 1786 as Agaricus micaceus in his work Herbier de la France.

[4] In 1801, Christian Hendrik Persoon grouped together all of the gilled fungi that auto-digested (deliquesced) during spore discharge into the section Coprinus of the genus Agaricus.

[6] It was the type species of subsection Exannulati in section Micacei of the genus Coprinus, a grouping of related taxa with veils made of sphaerocysts (round swollen cells usually formed in clusters) exclusively or with thin-filamentous connective hyphae intermixed.

[10] Due partly to their ready availability and the ease with which they may be grown in the laboratory, C. micaceus and other coprinoid mushrooms were common subjects in cytological studies of the 19th and 20th centuries.

The German botanist Johann Heinrich Friedrich Link reported his observations of the structure of the hymenium (the fertile spore-bearing surface) in 1809,[11] but misinterpreted what he had seen.

[3] In 1924, A. H. Reginald Buller published a comprehensive description and analysis of the processes of spore production and release in the third volume of his Researches on Fungi.

[16] The cap is initially 1–2.5 cm (1⁄2–1 in) in diameter, oval to cylindrical, but expands to become campanulate (bell-shaped), sometimes with an umbo (a central nipple-like protrusion); finally it flattens somewhat, becoming convex.

[22] Buller explained the "glitter" of these cells as follows: "The sparkling of the meal-cells, as well as of the cystidia on the edges and faces of the gills, is simply due to light which strikes them from without and is refracted and reflected to the eye in the same manner as from the minute drops of water one so often sees at the tips of grass leaves on English lawns early in the morning after a dewy night.

In his experiments, fruit bodies appeared roughly 40 to 60 days after initially inoculating the growth media (agar supplemented with soil, horse dung, or cornmeal) with spores.

[40] One study suggests that compared to C. truncorum, C. micaceus is browner in the center of the cap (rather than grayish) and has a greater tendency to grow in clusters; more molecular evidence is required to determine if the two taxa are genetically identical.

[17] Coprinellus micaceus is a saprotrophic species, deriving nutrients from dead and decomposing organic matter, and grows in and around stumps or logs of broad-leaved trees or attached to buried wood.

[42] A 2010 study suggests that the fungus can also live as an endophyte, inhabiting the woody tissue of healthy trees without causing disease symptoms.

[43] The fungus is also associated with disturbed or developed ground, such as the sides of roads and paths, gardens, building sites and the edges of parking lots;[44] it has also been noted for growing indoors on rotting wood in humid environments.

[16] In one instance it was discovered about 120 m (400 ft) underground in an abandoned coal mine, growing on wooden gangways and props used to support the roof.

In one case, a total of 38 lb (17.2 kg) of fresh mushrooms were collected from one elm stump in 10 successive crops over a spring and summer.

[57] Phylogenetic analysis of rDNA sequences from specimens collected in southeastern Asia and Hawaii show that the Hawaiian species form a distinct clade with little genetic diversity compared to Asian populations; this suggests that the Hawaiian populations have been introduced relatively recently and have not had much time to develop genetic variation.

[58] One study suggests that in South Africa, where C. micaceus is rare, it has been frequently confused with the similar-appearing C. truncorum, a more common species in that region.

[53][59] Coprinellus micaceus is an edible species,[21][60] and cooking inactivates the enzymes that cause autodigestion or deliquescence—a process that can begin as soon as one hour after collection.

The compound (Z,Z)-4-oxo-2,5-heptadienedioic acid has inhibitory activity against glutathione S-transferase, an enzyme that has been implicated in the resistance of cancer cells against chemotherapeutic agents, especially alkylating drugs.