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Multidrug resistance (Mdr) proteins are critical proteins for maintenance of drug resistance in fungi. Mdr1 has been extensively studied in <i>Candida albicans</i>; its role in other fungi is largely unknown. In this study, we identified a homologous protein of Mdr (AoMdr1) in the nematode-trapping (NT) fungus <i>Arthrobotrys oligospora</i>. It was found that the deletion of <i>Aomdr1</i> resulted in a significant reduction in the number of hyphal septa and nuclei as well as increased sensitivity to fluconazole and resistance to hyperosmotic stress and SDS. The deletion of <i>Aomdr1</i> also led to a remarkable increase in the numbers of traps and mycelial loops in the traps. Notably, AoMdr1 was able to regulate mycelial fusion under low-nutrient conditions, but not under nutrient-rich conditions. AoMdr1 was also involved in secondary metabolism, and its deletion caused an increase in arthrobotrisins (specific compounds produced by NT fungi). These results suggest that AoMdr1 plays a crucial role in the fluconazole resistance, mycelial fusion, conidiation, trap formation, and secondary metabolism of <i>A. oligospora</i>. Our study contributes to the understanding of the critical role of Mdr proteins in mycelial growth and the development of NT fungi.