Aims: To characterize the white rot fungus Perenniporia tephropora with respect to its laccase and to test its ability to decolourize synthetic dyes. Methods and Results: Under the culture conditions utilized, P. tephropora produced one laccase isozyme, which was purified to electrophoretic homogeneity by ammonium sulfate precipitation, size‐exclusion chromatography and anion‐exchange chromatography. The protein was monomeric with a molecular mass of 63 kDa (SDS–PAGE) and had an isoelectric point of 3·3. The N‐terminal amino acid sequence was SIGPVADLTVTNANI and the highest similarity value was found to the laccase from Lentinus tigrinus (86·6%). The optimum pH of the enzyme varied and was substrate dependent. It was 4·0 and 5·0 for 2,6‐dimethoxyphenol (DMP) and 2,2′‐azino‐di(3‐ethyl‐benzthiazoline‐6‐sulfonate) (ABTS), respectively. Under standard assay conditions, K_m values of the enzyme were 7·3 and 0·4 mmol l⁻¹ towards DMP and ABTS, respectively. The laccase was inhibited by NaN₃, EDTA and p‐coumarate but not by SDS and NaBr. Laccase was stable in the presence of some metal ions such as Cu²⁺, Co²⁺, Ca²⁺, Cd²⁺, Mg²⁺, Mn²⁺, Mo²⁺, Ni²⁺, Li⁺ and Al³⁺. The crude enzyme as well as the purified laccase was able to decolourize dyes from the textile industries, including remazol brilliant blue R, neolane blue and neolane pink. However, several other dyes were partially or not decolourized. In the presence of 1‐hydroxybenzotriazole as mediator, only the decolourization of neolane yellow was achieved, while the decolourization of most of the dyes was just slightly improved. Significance and Impact of the Study: This study is the first report on the purification and the characterization of the laccase from the white rot fungus P. tephropora. The high levels of laccase secreted by this fungal strain as well as its stability suggest that it could be a useful tool for environmental applications.