The straight mortise and tenon joints (SMTJs) of Tusi Manor, situated in the Yunnan–Tibet region of China, tend to undergo decay. This study aims to investigate the mechanism performance degradation of SMTJs due to decay. Five full-scale SMTJs were constructed and incubated with wood-rot fungi for 0, 6, 12, 18, and 24 weeks. Cyclic loading tests were conducted to assess the damage mechanisms and extent of mechanical property degradation at these different stages of decay, supported by ABAQUS finite element simulation software. The results revealed a progressive increase in damage with prolonged decay time. Comparison between decayed and undecayed specimens showed a maximum load-bearing performance degradation rate of 5.17%, 11.83%, 17.34%, and 23.54% after 6, 12, 18, and 24 weeks of fungal incubation, respectively. The cumulative energy efficiency degradation rates were 8.38%, 9.51%, 23.13%, and 33.31%, respectively. SMTJs mechanical performance degradation is correlated with wood mechanical property degradation as a function of the S-family. Finite element simulations further indicated a reduction in tenon strength from the outer parts towards the inner parts of the structure.