The laccase producing novel fungi, Marasmius sp. BBKAV79 (Gen Bank accession number KP455496, KP455497) was isolated and subjected to production and optimization of laccase by Submerged Fermentation (SmF). Submerged fermentation involves the nurturing of microorganisms in high oxygen concentrated liquid nutrient medium. The physical parameters namely pH, temperature, inoculum size, incubation time and the nutritional parameters like suitable carbon, nitrogen sources and solvents were studied for the higher laccase production. Yeast extract peptone dextrose-Copper sulphate (YPD-Cu) medium enhanced laccase production. The optimum pH and temperature for laccase was found to be 5.5 and 40o C respectively. The highest production of laccase at pH 6 and the temperature for production was recorded at 40°C. Optimum inoculum size and incubation time for laccase production at 14 mm 0f 6 fungal discs and 9th day respectively. Glucose and peptone were the most suitable carbon and nitrogen sources for laccase production. Ethanol was the most suitable solvent for laccase production. Novel sources of this laccase would be desirable to improve activity yields and substrate specificities.