Laura Smith
Denver has been dubbed America's most drug-friendly city, with the Denver district attorney's office pursuing only 11 psilocybin cases out of more than 9,200 drug crime prosecutions between 2016 and 2018. In 2019, Denver voters passed Initiative 301, a ballot measure to decriminalize psilocybin and direct law enforcement to give psychedelic mushrooms the lowest arrest priority for adults 21 and older. In 2024, a psilocybin mushroom co-op opened in Denver, and in 2025, Denver City Council approved rules for psilocybin businesses, allowing the personal use and possession of magic mushrooms. However, the sale of psilocybin remains illegal, and customers will pay to use it in a supervised environment or obtain it for free for personal use.
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What You'll Learn
Denver's first legal psilocybin businesses
Denver has been dubbed America's most drug-friendly city, and for good reason. In May 2019, Denver voters passed Initiative 301, a ballot measure to decriminalize psilocybin and direct law enforcement to make the arrest of adults 21 and older for possession of psychedelic mushrooms their lowest priority. This move was expected to increase the number of "psychedelic constituents" in the city, as more people would be drawn to the underground movement of therapists, doctors, and harm reduction professionals offering guided hallucinogenic experiences.
While the sale of psychedelic mushrooms remains a felony in Denver, the initiative effectively discouraged law enforcement from pursuing possession and personal use cases. This led to the emergence of a grey market, with some businesses giving away psilocybin while charging for related services, mirroring the early days of cannabis legalization. However, the city has recently adopted a new licensing law, signalling the end of this era and the beginning of regulated psilocybin businesses.
Denver City Council has approved rules for psilocybin businesses, and the state expects to start licensing some businesses soon. The new law does not allow for the retail sale of psilocybin. Instead, customers will pay to use it in a supervised environment or receive it for free for personal use. Healing centers and practitioners must obtain both state and local licenses, while cultivation, manufacturing, and testing facilities only need a state license. Additionally, healing centers will be banned within 1,000 feet of childcare centers and K-12 schools.
While the exact opening date of Denver's first legal psilocybin businesses is unknown, the city is taking steps towards creating a regulated framework for these establishments. The new licensing law aims to address concerns about the unregulated market, ensuring safe access to psychedelic services for those seeking therapeutic benefits. However, some critics worry that overregulation could make legal psilocybin use expensive and inaccessible, particularly for those who have found affordable natural approaches to medicine.
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Psilocybin production facilities and supervised use sites
In 2024, Denver, Colorado, witnessed the opening of its first magic mushroom co-op, marking a significant shift in the city's approach to psilocybin mushrooms. This development came in response to the state's new psychedelic laws, which allowed for the cultivation, possession, and sharing of psilocybin mushrooms by adults. However, the sale of psilocybin mushrooms remains illegal and is classified as a felony in Denver.
As the movement gained momentum, concerns arose about the lack of regulation in the burgeoning industry. The state's advisory board was tasked with providing recommendations on training and licensing for safe psychedelic services, with the first licenses anticipated to be granted by the end of 2024. The new regulations will impact psilocybin production facilities and supervised use sites, aiming to ensure the safe and responsible distribution and consumption of psilocybin mushrooms.
The licensing process for psilocybin businesses in Denver is overseen by the Department of Regulatory Agencies (DORA) and the Department of Revenue's new Natural Medicine Division (NMD). Healing centers and practitioners must obtain both state and local licenses, while cultivation, manufacturing, and testing facilities require only a state license. This differentiation in licensing requirements acknowledges the distinct roles and responsibilities of each entity within the psilocybin industry.
To address concerns about overregulation, the new laws in Denver do not permit the retail sale of psilocybin. Instead, customers will pay to use psilocybin in supervised environments or obtain it for free for personal use. Additionally, Denver has implemented a ban on healing centers within 1,000 feet of childcare centers and K-12 schools, aligning with state guidelines. These regulations strive to balance the accessibility of psilocybin for therapeutic purposes while maintaining control over the industry to protect public interests.
The path toward the legalization and regulation of psilocybin in Denver has been a gradual process. In 2019, Denver voters passed Initiative 301, which decriminalized psilocybin and instructed law enforcement to prioritize education and treatment over arrest for adults 21 and older. This initial step laid the foundation for the subsequent development of a regulated framework for psilocybin production facilities and supervised use sites.
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Denver's former law
Denver's relationship with psilocybin mushrooms has been an evolving one. In 2019, Denver voters passed Initiative 301, a ballot measure to decriminalize psilocybin and direct law enforcement to make the possession and use of psychedelic mushrooms the lowest arrest priority for adults over 21. This move made Denver America's most drug-friendly city, with the initiative attracting a lot of attention. While the sale of psilocybin remained a felony, the measure effectively instructed police to look the other way when it came to possession and personal use.
The former law, which was repealed, made enforcement involving psilocybin mushrooms the lowest priority for law enforcement. The Denver district attorney's office pursued very few psilocybin cases between 2016 and 2018, indicating that even before the initiative, mushroom-related offences were not a significant focus for law enforcement. The new law further reduced the likelihood of prosecution for possession and personal use.
However, the initiative also sparked concerns about potential negative impacts, including an increase in drug-related driving incidents and a blow to the city's reputation. Some residents worried that the measure would attract undesirable tourists and residents, similar to what happened after the legalization of recreational cannabis. There were also concerns about the potential for a sprawling, unregulated market with few controls on quality. Despite these worries, the mayor promised to honour the result of the vote, and the district attorney expressed support for treatment over incarceration.
In 2024, a psilocybin mushroom co-op opened in Denver, taking advantage of the relaxed laws around mushrooms. The founder, Darren Lyman, compared the situation to the early days of cannabis, when dispensaries dealt with raids and penalties before eventually gaining more widespread acceptance. Lyman stressed that his co-op was not selling psilocybin but rather providing advice and information. He also argued that his operation was not a supervised use site or a retail outlet, giving him confidence to operate openly.
In 2025, Denver's city council approved rules for psilocybin businesses, marking a shift in the city's approach to mushrooms. The new licensing law allows for the personal use and possession of magic mushrooms but does not permit their retail sale. Instead, customers can pay to use psilocybin in a supervised environment or obtain it for free for personal use. The law also includes restrictions on advertising and the location of healing centres. While some critics worry that the industry will become overly regulated and expensive, the new rules aim to provide a framework for the safe and legal operation of psilocybin businesses in Denver.
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Magic mushrooms as natural medicine
In 2025, Denver adopted a new licensing law for psilocybin businesses, marking a significant shift in the city's approach to mushrooms. While the exact timeline for the opening of legal psilocybin businesses remains unclear, the state was expected to begin licensing some companies in March 2025. This development highlights the growing recognition of magic mushrooms as a natural medicine with potential therapeutic benefits.
Magic mushrooms, or psilocybin, belong to a group of drugs known as psychedelics. They have been used by Indigenous communities worldwide for over a thousand years and are believed to be depicted in rock paintings in Western Australia dating back more than 10,000 years. In modern times, magic mushrooms have gained attention for their potential in treating mental health conditions, particularly depression and anxiety.
Psilocybin works by binding to serotonin receptors like 5-HT2AR, which influences mood, cognition, and perception. This mechanism of action sets it apart from traditional treatments for depression and anxiety, which often fail to address the root causes of mental distress or provide long-term relief. By temporarily breaking down rigid and entrenched thought patterns, psilocybin can induce profound shifts in perspective, perception, and emotional regulation.
Several studies have demonstrated the effectiveness of psilocybin-assisted therapy in treating major depressive disorder and anxiety. For example, a small study by Johns Hopkins Medicine researchers found that two doses of psilocybin, combined with supportive psychotherapy, produced rapid and significant reductions in depressive symptoms, with some participants achieving remission through the four-week follow-up. Furthermore, a follow-up study reported that the antidepressant effects of psilocybin-assisted therapy may last at least a year for some patients.
In addition to depression and anxiety, psilocybin has shown promise in treating other conditions such as addiction and post-traumatic stress. An online survey of over 300 people with Alcohol Use Disorder found that a significant number reported reducing or abstaining from alcohol use after taking psilocybin. This adds to the growing evidence supporting the investigation of psilocybin-assisted treatment for substance abuse.
As the body of research supporting the therapeutic benefits of magic mushrooms grows, it is essential to approach their use as natural medicine with caution and under the guidance of trained professionals. While magic mushrooms have shown potential in treating various conditions, they are not without risks, and further research is needed to fully understand their long-term effects and optimal therapeutic applications.
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Unlicensed psilocybin businesses
In 2024, Denver approved the use of psilocybin mushrooms for adults over 21. However, the sale of the substance remains illegal, and it can only be cultivated, possessed, and shared. This has led to the rise of unlicensed psilocybin businesses in the city, which operate in a grey area. These businesses give away the drug while charging for related services, such as advice and informational pamphlets.
One such business is a magic mushroom co-op founded by Darren Lyman, who compares his operation to the early days of cannabis. Lyman argues that his co-op is not a supervised use site or a retail outlet but a private, dual-zoned property. He claims to be selling services rather than the product itself, which he stresses is free. However, critics argue that this is a way to circumvent the law, and law enforcement agencies have cracked down on similar cannabis operations in the past.
The presence of these unlicensed businesses has sparked concerns about the lack of regulation in the market. Some worry that it will lead to a sprawling, uncontrolled market with few controls on quality, creating a "Wild West" scenario for recreational use. There are also concerns about the safety of the unregulated therapeutic uses of psilocybin, which have gained popularity for treating various mental ailments.
The state's Division of Professions and Occupations will oversee the regulation of psilocybin substances, while the Division of Natural Medicine will oversee where they can be grown, manufactured, tested, and administered. However, the process of obtaining licenses for psilocybin businesses is expected to be lengthy, with applications for production facilities and supervised use sites becoming available in 2024.
In the meantime, Denver's new rules for psilocybin businesses require healing centers and practitioners to obtain both state and local licenses, while cultivating, manufacturing, and testing facilities need only a state license. The city has also implemented a ban on healing centers within 1,000 feet of childcare centers and K-12 schools. These regulations aim to address the concerns about the unregulated market and ensure the safe and responsible use of psilocybin mushrooms in Denver.
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Frequently asked questions
Denver has had a complicated history with mushrooms. In 2019, Denver voters passed Initiative 301, a ballot measure to decriminalize psilocybin and direct local law enforcement to give possession of psychedelic mushrooms the lowest priority for adults 21 and older. In 2024, a psilocybin mushroom co-op opened in Denver, and in 2025, Denver City Council approved rules for psilocybin businesses in the city.
While the sale of mushrooms remains illegal in Denver, the criminal penalties for growing and possession have disappeared, making it harder for people to get caught.
The future of mushrooms in Denver is uncertain. Some critics worry that overregulating the industry will make it prohibitively expensive to use psilocybin mushrooms legally, while others are concerned about the potential damage to the city's reputation if it becomes known as a haven for recreational drug use.
Under Denver's new rules, healing centers and practitioners must have both a state and local license, while cultivating, manufacturing, and testing facilities only need a state license. The new rules also ban healing centers within 1,000 feet of childcare centers and K-12 schools and do not allow natural medicines to be advertised to minors.
