Environmental contamination, extensive exploitation of fuel sources and accessibility of natural renewable resources represent the premises for the development of composite biomaterials. These materials have controlled properties, being obtained through processes operated in mild conditions with low costs, and contributing to the valorization of byproducts from agriculture and industry fields. A novel board composite including lignocelullosic substrate as wheat straws, fungal mycelium and polypropylene embedded with bacterial spores was developed and investigated in the present study. The bacterial spores embedded in polymer were found to be viable even after heat exposure, helping to increase the compatibility of polymer with hydrophilic microorganisms. Fungal based biopolymer composite was obtained after cultivation of Ganoderma lucidum macromycetes on a mixture including wheat straws and polypropylene embedded with spores from Bacillus amyloliquefaciens. Scanning electron microscopy (SEM) and light microscopy images showed the fungal mycelium covering the substrates with a dense network of filaments. The resulted biomaterial is safe, inert, renewable, natural, biodegradable and it can be molded in the desired shape. The fungal biocomposite presented similar compressive strength and improved thermal insulation capacity compared to polystyrene with high potential to be used as thermal insulation material for applications in construction sector.