Renewable fuels are among the most effective ways to achieve sustainable development. Increasing their share can contributeto increase fossil fuel reserves. Besides, they can canpansate the threats raised by climate change androvidemore security for energy supplies on a global scale. Bioethanol has been considered as an alternative fuel in recent years. The raw materials used to produce bioethanol are dividedinto three general categories of sugars, starchy, and lignocellulosic materials.Zygomycetes, including filamentous fungi, are able to produce various metabolites such as ethanol and glycerol. Mucorindicus , adimorphic filamentous fungus belonging to thezygomycetes,is an excellentchitosaroducing microorganism. In this research, the effects of replacing the fungal extract, the digestible and essential micro-nutrient, produced from the autolysis process of the M.indicus iomass, was used instead of the required nutrients (yeastextractand minerals) for the growth of microorganism andioethanolroduction. Performing the autolysis process at 50 °C and H 5 resultedin the production ofa rich source of valuable and essential nutrients (fungus extract). Furthermore, the amount ofchitosain the alkali-insoluble material(AIM) resulted in a significant increase in the remaining cellular material after the autolysis. Theyields of ethanolin the presence offungal extract and minerals under aerobic and anaerobic fermentation conditions for glucose were 0.41 and 0.46 g/g, respectively, while it was 0.16 g/g for xylose under aerobic conditions. In the next step,ioethanolroduction from rice straw by M.indicus using thefungalextract as an alternative nutrientwas studied. The results showed that the use of fungal extract (5 gram per liter) with mineral salts increased the efficiency of ethanol production from rice straw under aerobic and anaerobic conditions (0.29 and 0.4 g/g). Besides, thechitosayield after autolysis for optimalretreatment increased by 57.2%.