This study presents a life cycle assessment (LCA) of mycelium-based composite materials (MBCs) produced in a laboratory setting, comparing them with conventional insulation materials. MBCs show potential as sustainable alternatives due to their lower environmental impact, particularly in terms of climate change and fossil energy demand. The LCA found that MBCs have a climate change impact of 0.3668 kg CO₂ eq/kg MBC, significantly lower than conventional materials like extruded polystyrene, quadcore sandwich panels, foam concrete, and rockwool. However, the end-of-life of MBCs was not assessed, and wood-fiber and straw panels performed better in terms of climate change. MBCs also have lower fossil energy demand than conventional materials, though land-use and water demand are higher. The study highlights the importance of using renewable energy and sustainable substrates to further reduce environmental impacts. The results indicate that MBCs could be a viable alternative to conventional materials, particularly if produced with renewable energy and using substrates like sawdust, which reduces water and land use. The study also notes that while MBCs have lower environmental impacts, further research is needed to address scalability, raw material availability, and regulatory compliance. The LCA methodology used in this study provides a comprehensive assessment of MBCs, demonstrating their potential as sustainable construction materials.This study presents a life cycle assessment (LCA) of mycelium-based composite materials (MBCs) produced in a laboratory setting, comparing them with conventional insulation materials. MBCs show potential as sustainable alternatives due to their lower environmental impact, particularly in terms of climate change and fossil energy demand. The LCA found that MBCs have a climate change impact of 0.3668 kg CO₂ eq/kg MBC, significantly lower than conventional materials like extruded polystyrene, quadcore sandwich panels, foam concrete, and rockwool. However, the end-of-life of MBCs was not assessed, and wood-fiber and straw panels performed better in terms of climate change. MBCs also have lower fossil energy demand than conventional materials, though land-use and water demand are higher. The study highlights the importance of using renewable energy and sustainable substrates to further reduce environmental impacts. The results indicate that MBCs could be a viable alternative to conventional materials, particularly if produced with renewable energy and using substrates like sawdust, which reduces water and land use. The study also notes that while MBCs have lower environmental impacts, further research is needed to address scalability, raw material availability, and regulatory compliance. The LCA methodology used in this study provides a comprehensive assessment of MBCs, demonstrating their potential as sustainable construction materials.