A strain of the fungus Coriolus versicolor was inoculated periodically into potato dextrose agar (PDA) slants containing the effluent to enhance the natural ability to grow in the effluent. The acclimated strain grown in the 50% effluent-containing PDA slant and the original strain were employed to treat the effluent. The acclimated strain could grow in a higher concentration of the effluent than the original unacclimated one. Both the original and acclimated strains improved the dispersing ability of the effluent, especially the acclimated strain because of its higher laccase secretion. The dispersing ability of the SFP effluent was improved to a level comparable to a commercial lignosulfonate product because it was strongly polymerized by the fungus. During the fungal treatment, more than 50% of the sugars were removed from the effluent, thereby increasing the purity of the SFP lignin product.