<p>An agent-based model is developed to explore the pattern of fuelwood collection in an 1178 ha forest area in rural mountainous Nepal. The model relates fuelwood collection intensity and amount of dead wood available for collection to the diversity of polypore species, a group of strictly dead wood dependent fungi which can be used as indicators of the biodiversity associated with dead wood. By analysing scenarios of increased collection the model shows that the relative impact on polypore diversity is rising more rapidly than the time used for collection. This indicates that better market access in the future could potentially imply a major threat to biodiversity associated with dead wood. To assess the potential for biodiversity conservation we evaluated the effect of protecting areas with high values of polypore diversity. The simulation results showed such area protection strategies to be effective for short-term protection of polypore diversity only in the event of a dramatic increase in the local market price of fuelwood. In case of smaller changes in fuelwood prices a collection quota system appeared to be the most suitable protection strategy. However, area protection is an important strategy for long-term protection of biodiversity associated with dead wood and, therefore, we conclude that a combination of small-protected zones and collection quotas seems to be the most promising strategy for protection of the forest.</p>