Unlike oyster mushrooms, O. nidiformis is poisonous; while not lethal, its consumption leads to severe cramps and vomiting. The toxic properties of the mushroom are attributed to compounds called illudins. O. nidiformis is one of several species in the cosmopolitan genus Omphalotus, all of which have bioluminescent properties.
While differing from edible oyster mushrooms in toxicity, O. nidiformis contains poisonous compounds that cause intense stomach issues upon consumption. As part of the Omphalotus genus, which comprises various bioluminescent species, O. nidiformis shares this characteristic.