Mushroom cultivation nowadays is mostly practised as an indoor cultivation. The yield of mushrooms is lesser in conventional methods. In conventional methods of Mushroom cultivation, Mushrooms are cultivated inside a cottage with a highly closed environment in order to obtain the required temperature and humidity. By doing such practices, the required level of temperature and humidity are not met and results in low yield of mushrooms and makes very less profit. To improve the yield of mushrooms, automation in mushroom cultivation is needed and can be achieved using smart electronic components.To achieve the required cooling inside the farm, sprinklers areused. The main objective is to monitor and control the physical parameters automatically and display it in the LCD. In this proposed method of Mushroom cultivation, the physical parameters like temperature and humidity required for mushroom cultivation are continuously monitored and are automatically adjusted to the required conditions. Farmers can also view these parameters in LCD. By this method, required cooling is obtained than conventional methods of cooling. In order to sense the humidity and temperature level of the mushroom, the DHT11 sensor is fixed.The optimal humidity level is 55-70%. If the humidity level goes below optimal level, water sprinklers are automatically turned on and humidity level will be maintained. Water sprayer gets turned on when the humidity level of the mushroom gets reduced.If humidity is high then automatically the sprinkler will get deactivated from work. The adequate temperature for mushroom growth is 20 C to 30 C. If the level of temperature gets increasing and decreasing above or below the adequate level , sprinklers get turned on and off automatically. One of the advantages of this proposed method is less consumption of power and water. Wastage of water could be reduced with the help of a DHT11 sensor. Water flow will be stopped when the mushroom gets an adequate humidity level. By using sprinklers, power can be saved. Pre assigned parameter range of mushrooms are programmed in an ATMEGA328p microcontroller. By adopting this technique in the mushroom cultivation, it is possible to obtain mushrooms with higher quantities and this makes more profit for the cultivator rather than the conventional methods.