This study aims to investigate the antifungal and protective effects of water- and 70% methyl alcohol-extracts from spent mushroom substrate (WESMS and MeOHSMS) of Lentinula edodes, on Botrytis cinerea- the causative agent for gray mold disease in ginseng. MeOHSMS inhibited mycelial growth and spore germination of Botrytis cinerea, by 75% and 95%, respectively. MeOHSMS could suppress gray mold disease of ginseng seedlings by 80% and effectively reduce the disease severity by 60%. Compared to the treatment of ginseng leaves with WESMS and DL-β-aminobutyric acid (BABA), the MeOHSMS treatment increased the phenolic compounds in the leaves by 36% and 18%, respectively. These results suggest that the SMS extracts suppress gray mold disease in ginseng via dual functions: antifungal activity and increase in a plant defense factor— phenolic compounds.