It is mainly found in the meadows above 3,500 metres (11,500 ft) on the Tibetan Plateau in Tibet and the Himalayan regions of Bhutan, India, and Nepal.

It parasitizes larvae of ghost moths and produces a fruiting body which is valued in traditional Chinese medicine as an aphrodisiac.

[4] However, naturally harvested fruiting bodies often contain high amounts of arsenic and other heavy metals, making them potentially toxic.

[5] O. sinensis parasitizes the larvae of moths within the family Hepialidae, specifically genera found on the Tibetan Plateau and in the Himalayas, between elevations of 3,000 and 5,000 metres (10,000 and 16,000 ft).

The fungus germinates in the living larva, kills and mummifies it, and then a dark brown stalk-like fruiting body which is a few centimeters long emerges from the corpse and stands upright.

[12] Additional research needs to be carried out in order to understand its morphology and growth habits for conservation and optimum utilization.

[13] The stroma is the upper fungal part and is dark brown or black, but can be a yellow color when fresh, and longer than the caterpillar itself, usually 4–10 cm.

This is different from other Cordyceps species, which produce either immersed or superficial perithecia perpendicular to stromal surface, and the ascospores at maturity are disarticulated into part spores.

[15] In Tibet, it is known as yartsa gunbu, དབྱར་རྩྭ་དགུན་འབུ་ (Wylie: dbyar rtswa dgun 'bu, ZYPY: 'yarza g̈unbu', Lhasa dialect: [jɑ̀ːt͡sɑ kỹ̀pu], "summer grass winter worm").

It is known in Chinese as dōng chóng xià cǎo (冬蟲夏草), meaning "winter worm, summer grass", which is a literal translation of the original Tibetan name.

Strangely, sometimes in Chinese English-language texts Cordyceps sinensis is referred to as aweto, which is the Māori name for Ophiocordyceps robertsii, a species from south-eastern Australia and New Zealand.

Similarly, Metarhizium anisopliae is not considered anamorph as it has widely distributed host range, and is not restricted only in high altitude.

The caterpillars prone to infection by O. sinensis generally live 15 cm (5.9 in) underground[22] in alpine grass and shrub-lands on the Tibetan Plateau and the Himalayas at an altitude between 3,000 and 5,000 m (9,800 and 16,400 ft).

[22] Fifty-seven taxa from several genera (37 Thitarodes, 1 Bipectilus, 1 Endoclita, 1 Gazoryctra, 3 Pharmacis, and 14 others not correctly identified to genus[9]) are recognized as potential hosts of O. sinensis.

The stalk-like dark brown to black fruiting body (or mushroom) grows out of the head of the dead caterpillar and emerges from the soil in alpine meadows by early spring.

So far the oldest known text documenting its use was written in the late 15th century by the Tibetan doctor Zurkhar Nyamnyi Dorje (Wylie: Zur mkhar mnyam nyid rdo rje) [1439–1475]) in his text: Man ngag bye ba ring bsrel ("Instructions on a Myriad of Medicines"), where he describes its use as an aphrodisiac.

[26] The first mention of Ophiocordyceps sinensis in traditional Chinese medicine was in Wang Ang’s 1694 compendium of materia medica, Ben Cao Bei Yao.

In traditional Chinese medicine, it is regarded as having an excellent balance of yin and yang as it is considered to be composed of both an animal and a vegetable.

A 2012 BBC article indicated that in north Indian villages a single fungus was worth Rs 150 (about £2 or $3), which is more than the daily wage of a manual labourer.

[27] Because of its high value, inter-village conflicts over access to its grassland habitats has become a headache for the local governing bodies and in several cases people were killed.

In November 2011, a court in Nepal convicted 19 villagers over the murder of a group of farmers during a fight over the prized aphrodisiac fungus.

[36] Collecting yarchagumba in Nepal had only been legalised in 2001, and now demand is highest in countries such as China, Thailand, Vietnam, Korea and Japan.