Soil fungi impact plant health because they grow in, on, and around roots, infecting healthy tissues and colonizing senescent materials. We review the literature concerning these fungi and discuss the various interactions that occur among the root-inhabiting fungi and their diversity at the community level. Root-inhabiting fungi are classified as clinical and subclinical pathogens, mycorrhizal fungi, and additional nonpathogenic fungi. We define each group, present data on abundance and distribution, and describe their roles in agroecosystems. We also discuss the application of island biogeography theory to the understanding of fungal species diversity in the root zone. Our goal is to contribute to a better understanding of the complex ecology of root-inhabiting fungi so researchers can formulate reasonable and testable hypotheses concerning the roles these fungi play in maintaining the delicate balance between plant health and disease. We describe the implications of fungal interactions for biological control strategies of root pathogens using three diverse approaches: single tactic, integrated pest management, and proactive pest management. We conclude that it is the very complex nature of the rhizosphere that makes it imperative that we invest resources into fundamental research of rhizosphere ecology.