Glowing Mushroom

Glowing Mushrooms are a restorative item found in blue grassy areas local to the Underground biome, normally in the stone layer. They may occur anywhere in the stone layer, at the top or the very bottom, so don't get frustrated if you can't find them. These may be consumed to recover 25 health, or used in alchemy to create healing and Mana Potions.

They can be found as big as surface trees, usually around half a dozen on any given glowing mushroom patch. These giant mushrooms must be chopped down with an axe just like a normal tree if you wish to harvest them, and can rarely drop a Mushroom Grass Seed. They also drop a varying number (few to many) of glowing mushrooms when cut down, although it's not necessary as the smaller mushrooms do, in fact, drop seeds.

Glowing mushrooms are not always dropped when harvesting them from the small mushroom nodes but are always dropped from the mushroom trees.

The player can tell when he is close to a patch of glowing mushrooms because of the light they emit in the darkness.

Farming
Many people who need to make healing potions mid-game tend to resort to farming. It creates an easy way to receive glowing mushrooms to make regular healing potions. Before hard mode, most players simply buy lesser healing potions and use them to craft potions with the mushrooms from their farm.

Mushroom farms can grow glowing mushroom trees, though they need a significant height to do so. Glowing mushrooms only grow below sea level, as noted by the Depth Meter.

Underground Glowing Mushroom Farming:

Excess glowing mushroom stock can be sold to vendor for 10 copper each. A full stack of 99 glowing mushrooms will sell for a total of 9 silver and 90 copper, useful to players with high-yield mushroom farms that do not need the extra potions but could benefit from the extra coins.
 * A horizontal tunnel three blocks high
 * The bottom is lined with mud blocks. Mushroom grass is then planted on these blocks, via Mushroom Seeds.
 * Mushrooms are harvested when needed from this section.