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Gymnopus dichrous exists in the southern Appalachians (USA) as two distinct entities with essentially identical nuclear ribosomal ITS1 sequences but differing ITS2 and LSU sequences (for convenience, called G. dichrous I and II). F1 ITS heterozygotes between the two are routinely collected from nature. Cloning of ITS PCR products from F1 heterozygotes produced sequences of both parental haplotypes but also numerous chimeric sequences (21.9%). The location of template switching was non-random leading to recovery of the same chimera several times and the chimeric region varied from 45bp to 300bp. By comparison, single-basidiospore isolates from heterozygote F1 fruitbodies showed no recombinant haplotypes within the ITS + LSU span and clones derived from P1 homozygotes were identical to the P1 parent. Thus, chimeric sequences are likely an artifact of the PCR-cloning process and not a consequence of natural recombination events found in nature, nor are they due to hidden existing variation within the ribosomal repeat. Chimeras and PCR-induced mutations are common in cloned PCR products and may result in incorrect sequence information in public databases.