Selenium (Se) and tellurium (Te) are elements, they are part of the chalcogens (VI‐A group of the periodic table) and share common properties. These metalloids are of commercial interest due to their physicochemical properties, and they have been used in a broad range of applications in advanced technologies. The water soluble oxyanions of these elements (i.e., selenite, selenate, tellurite and tellurate) exhibit high toxicities, thus their release in the environment is of great concern. Different physicochemical methods have been developed for the removal of these metalloids, mainly for Se. However, these methods require specialized equipment, high costs and they are not ecofriendly. The biological treatment is a green alternative to remove Se and Te from polluted effluents. This remediation technology consists on the microbial reduction of Se and Te oxyanions in wastewater to their elemental forms (Se0 and Te0), which are less toxic, and when synthesized in the nano‐size range, they can be of commercial value due to their enhanced properties. The use of fungi as potential Se‐ and Te‐reducing organisms was demonstrated in this study. Response of the model white‐rot fungus, Phanerochaete chrysosporium, to the presence of selenite and tellurite was evaluated, as well as their potential application in wastewater treatment and production of nanoparticles. The presence of Se and Te (10 mg L‐1) had a clear influence on the growth and morphology of the fungus. P. chrysosporium was found to be more sensitive to selenite. Synthesis of Se0 and Te0 nanoparticles entrapped in the fungal biomass was observed, as well as the formation of unique Se‐Te nanocomposites when the fungus was cultivated concurrently in the presence of Se and Te. Potential use of fungal pellets for the removal of Se and Te from semi‐acidic effluents (pH 4.5) was suggested. Moreover, the continuous removal of selenite (10 mg Se L‐1 d‐1) in a fungal pelleted reactor was evaluated. The reactor showed to efficiently remove Se at steady‐state conditions (~70%), and it demonstrated to be flexible and adaptable to different operational conditions. The reactor operated efficiently over a period of 35 days. Good settleability of the fungal pellets facilitated the separation of the Se from the treated effluent. The use of elemental Se immobilized fungal pellets as novel biosorbent material was also explored. This hybrid sorbent was promising for the removal of zinc from semi‐acidic effluents. The presence of Se in the fungal biomass enhanced the sorption efficiency of zinc, compared to Se‐free fungal pellets. Most of the research conducted in this study was focused on the use of fungal pellets. However, the response of the fungus to selenite in a different kind of growth was also evaluated. Microsensors and confocal imaging were used to evaluate the effects of Se on fungal biofilms. Regardless of the kind of fungal growth, P. chrysosporium seems to follow a similar selenite reduction mechanism, leading to the formation of Se0. Architecture of the biofilm and oxygen activity were influenced by the presence of Se.