Aim of the Study: The study was to integrate mushroom and biogas production using mixed palm oil to provide both food and energy source to palm oil producing communities as well as reducing environmental pollution. Design of the Study: Mixed palm oil waste was divided into two portions. One portion was used for mushroom cultivation and afterwards the spent mushroom substrate and the untreated portion were used for biogas production. Methodology: Structural sugars analysis was performed using double acid hydrolysis technique. Total crude protein was determined through kjeldal acid digestion method. Lipids were extracted using a mixture of chloroform and methanol and quantified gravimetrically. The mushroom strain (Coprinus scinereus) was cultivated on the mixed palm oil waste. Afterwards, the spent mushroom substrate and the untreated palm oil waste were subjected to anaerobic digestion in automatic methane potential test system. Place and Duration of Study: The study was completed in 2 years from 2014-2015. Mushroom cultivation was carried out at the University of Dar-e salaam, Tanzania, whereas feedstock characterization and anaerobic digestion were performed at Lund University, Sweden. Results: Compositional analysis disclosed that the feedstock contains (% w/w) 0.1 proteins, 3.3 carbohydrates, 22.5 lipids, and 73 lignin. Mushroom yield was 0.64 g /g of substrate at a biological efficiency of 71.4 g/100 g of substrate and productivity of 21.5±0.5%. Consequently total carbohydrates and lipids were decreased by 70% and 76% while the relative content of lignin and protein increased by 23% and 50%, respectively. Particle size reduction (<4 mm) resulted to increased methane yield by 66%. The untreated and biologically treated mixed palm oil wastes yielded 517 and 287 of CH4 L/Kg VS added which corresponded to 80% and 64.5% of theoretical methane yield, respectively. Conclusion: Combined mushroom and biogas production offer superior benefits in the utilization of the palm oil waste.