ABSTRACT: This study aims to find a high-efficiency degradation strain which can biodegrade the 2,3,7,8-Tetrachlorodibenzo-P-dioxin (2,3,7,8-TCDD). In this paper, a new fungus strain was isolated from activated sludge of Dagu Drainage River in Tianjin which was able to degrade 2,3,7,8-TCDD in the medium. Based on its morphology and phylogenetic analysis of its 18S rDNA sequence, the strain was identified as Penicillium sp. QI-1. Response surface methodology using central composite rotatable design of cultural conditions was successfully employed for optimization resulting in 87.9 % degradation of 2,3,7,8-TCDD (1 µg/mL) within 6 days. The optimum condition for degrading 2,3,7,8-TCDD was at 31℃ and pH 7.4. The biodegradation process was fitted to a first-order kinetic model. The kinetic equation was Ct=0.939e- 0.133t and its half-life was 5.21d. The fungus strain degraded 2,3,7,8-TCDD to form intermediates, they were 4,5-Dichloro-1,2-benzoquinone, 4,5-Dichlorocatechol, 2-Hydrooxy-1,4-benzoquinone, 1,2,4-Trihydroxybenzene and β-ketoadipic acid. A novel degradation pathway for 2,3,7,8-TCDD was proposed based on analysis of these metabolites. The results suggest that Penicillium sp. QI-1 may be an ideal microorganism for biodegradation of the 2,3,7,8-TCDD-contaminated environments.