Lawn fungus? Help!!

Newhomeowner – posted 03 October 2011 20:06

We just bought a new home a couple months ago, and discovered large white and gray clumps embedded in our lawn. Some areas are more than 5 inches wide, and 1-2 inches thick including it’s bottom layer that is embedded in the soil. When i dug some up and out of the lawn, they dislodged in solid pieces and i found the bottom layer to be bright orange. They are very firm, though the grass is growing straight through the mass. There is no uniform shape to the masses, though the smaller ones tend to be more round. There is also one larger mass that seems to have ‘erupted’ with a brown powdery substance that I can only assume are spores.

Can anyone confirm that this is a fungus? Any ideas for treating it? Any and all advice is appreciated.