Described herein are methods for the alteration and/or transfer of fungal functional traits, e.g., phenotypic activity, via the controlled transfer of endohyphal symbionts, e.g., bacteria, among fungal species. Also described are methods for the identification of endohyphal bacterial symbionts as determinants of cellulase and ligninase activity in fungi, and the use of endohyphal bacterial symbionts to alter the activity, including cellulase and ligninase activities, of the fungi. In particular, the fungi described herein are endophytic fungi, that is, fungi which colonize living, and subsequently senescent, plant tissue.