Abstract: The taxadiene synthase gene (ts) and hygromycin phosphotransferase gene (hph) were used in the co -transformation of Flammulina velutipes protoplasts by PEG -mediated method in this paper. The results showed that 8 out of 18 putative transformants were integrated into both ts and hph genes, its co-transformation eficiency was 44.44%. RT-PCR results indicated that 7 transformants obtained the transcription of taxadiene synthase gene. Those transformants still maintained the hgromycin B resistance after 5 generations of subcultures on PDA plates without hygromycin, suggesting that the exogenous gene hph was stable during asexual reproduction (mitosis) of transgenic F. velutipes. The research laid a solid foundation for the improvement of the quality of F. velutipes varieties and production of high value products by using F. velutipes as a novel bioreactor.