Mycelium

Mycelium is a particularly rare variant of dirt that is found naturally only in mushroom fields biomes. It has a particle effect that resembles tiny spores being released constantly from the surface.

Breaking
Mycelium can be obtained by mining it using a tool with the Silk Touch enchantment. If mined with any other tool or by hand, it drops dirt. A shovel is the fastest tool to collect it.

Mob loot
Endermen can pick up mycelium blocks, and drop the block they are holding if killed.

Spread
A mycelium block can spread to any dirt block within one space above, one sideways, or three down. The mycelium needs light level 9+ above it, while the dirt needs light level 4+ above it, and must not be covered by any light-impeding block or any opaque block. Mycelium reverts to dirt when covered by one of the light-impeding blocks above, and the light level at that block is below 4. The death and spread behaviors are checked when a random tick lands on the block.

If there is a plant on a dirt block when mycelium spreads to it, the plant pops out and drops as an item.

Dirt path
Mycelium can be turned into a dirt path by any type of shovel on it.

Effect on plants

 * Mushrooms and fungus can remain on mycelium blocks in any light level, unlike the situation on other blocks, where mushrooms are broken (dropping as items) during block updates in high light.
 * Huge mushrooms can grow on mycelium, just as they can grow on dirt, grass, or podzol.
 * Mycelium cannot be tilled with a hoe to make farmland.
 * However, it can first be converted to dirt path using a shovel, then tilled with a hoe to create farmland.
 * $$, pumpkins and melons do not grow on it.

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Trivia

 * It is a common misconception that only mooshrooms can spawn on mycelium. This is not true; it is the mushroom island biome itself that prevents other mobs from spawning there. Friendly and hostile mobs can spawn on mycelium in other biomes just like they do on any other block. Also, mycelium outside of mushroom fields does not spawn mooshrooms.
 * In real life, mycelium is the part of a fungus that gathers nutrients, comprised of web-like threads known as hyphae. Mycelium can be considered the roots of a fungus, whereas the mushrooms can be considered the fruits.