Psilocybe azurescens occurs naturally along a small area of the West Coast of the United States. It has been regularly found as far south as Depoe Bay, Oregon and as far north as Grays Harbor County, Washington. Its primary locations are clustered around the Columbia River Delta: the first type collections were made in Hammond, Oregon, near Astoria. It is also quite prevalent north of the Columbia River in Washington. Equally important of Psilocybe azurescens have also been reported in Stuttgart, Germany. While infrequent, the mushroom can sometimes be found around decaying wood too. Which decriminalized psilocybin in 2020. Ilwaco, Washington also has a large population and harvesting is a potential felony that is enforced by local law enforcement agencies.

Lastly the species’ preferred environment ranges from caespitose (growing in tight, separated clusters) to gregarious on deciduous wood-chips and/or in sandy soils rich in lignicolous (woody) debris. Next the mushroom has an affinity for coastal dune grasses.² In aspect it generates an extensive, dense, and tenacious mycelial mat (collyboid). P. azurescens causes the whitening of wood. Equally important fruitings begin in late September and continue until “late December and early January”, according to mycologist Paul Stamets.² Psilocybe azurescens has been cultivated in many countries too.