Convex to obtusely campanulate with an incurved margin at first, rarely becoming plane, and often are umbonate or with a slight depression in the center.

The cap is hygrophanous, yellowish brown to reddish brown with a silvery-blue metallic luster, paler at the margin, and drying to a beige or straw yellow.

Psilocybe caerulescens spores are dark violaceous brown.

It is equal or enlarging slightly at the base, and is somewhat flexuous, hollow, and subpruinose to floccose.

The stipe is whitish to reddish brown or blackish and readily bruises blue.

Basidia 18.5–22.5 × 5.5–6.5 μm, cylindrical, four spored, hyaline and thin-walled.

Pileocystidia (10–) 12–28 × 4–9.5 μm, globose, cylindrical, clavate, flexuose or pyriform and thin-walled.

Psilocybe caerulescens is found growing gregariously or cespitosely, rarely solitarily, from June through October on disturbed ground often devoid of herbaceous plants.

It often grows in sunny locations, preferring muddy orangish brown soils with much woody debris.

Psilocybe caerulescens was first reported from near Montgomery, Alabama, by Murrill in 1923 on sugarcane mulch, not re-documented from that locality since.

Psilocybe caerulescens is common and widespread throughout northern Georgia.