Edible fungi are the nutritive and healthy food, keeping consumer in good health and guiding national food security. China has become the biggest country for edible fungi production worldwide with many kinds of cultivation species. However, there are some problems for edible fungi production in China, including small scale, outdated technology, and development imbalance between regions. In the past decade, the market demand for edible fungi has increased annually. Therefore, in order to improve the yield and nutritional quality of edible fungi, factory production technology becomes an urgent task. Factory production of edible fungi is referred to cultivate edible fungi under controllable closed facilities all the year round. Since the nutrition patterns and environmental requirements for edible fungi are completely different comparing with the plants. Light is a necessary environmental factor that is needed in the formation of fruiting body primordium and the development of fruiting body. Various edible fungi pose different photobiological traits to light quality and light intensity. In fact, traditional electric sources are unable to meet diverse and precise light environment for the factory production of edible fungi. As a kind of semiconductor light source, Light-Emitting Diode (LED) has many advantages over traditional electric light sources in terms of light quality, light efficiency, and spectral energy distribution. Nowadays, LED becomes an ideal light source for the factory production of edible fungi due to the decline of LED price and enhancement of lighting emitting. The advances in the photobiology of edible fungi are summarized, and the application prospects of LED in the factory production of edible fungi are emphasized.