Shiitake are native to China but have been grown in both Japan and China since prehistoric times. They have been cultivated for over 1000 years; the first written record of shiitake cultivation can be traced to Wu Sang Kwuang, born during the Song Dynasty (AD 960–1127). However, some documents record the uncultivated mushroom being eaten as early as AD 199.
During the Ming Dynasty (AD 1368–1644), physician Wu Juei wrote that the mushroom could be used not only as a food but was taken as a remedy for upper respiratory diseases, poor blood circulation, liver trouble, exhaustion and weakness, and to boost qi, or life energy. It was also believed to prevent premature aging.
Before 1982 the Japanese variety of these mushrooms could only be grown in traditional locations using ancient methods. In the late 1970s, Gary F. Leatham published a doctoral thesis based on his research on the budding and growth of the Japan Islands variety; the work helped make commercial cultivation possible worldwide, and Dr. Leatham is now known in the industry as the "Father of Shiitake farming in the USA."
Shiitake mushrooms have been researched for their medicinal benefits, most notably their anti-tumor properties in laboratory mice. These studies have also identified the polysaccharide lentinan, a (1-3) β-D-glucan, as the active compound responsible for the anti-tumor effects. In fact, some countries classify lentinan as a clinical drug. The speculative anti-cancer properties of this mushroom are thought to be linked to upregulation of the immune system. An in vitro study supports this idea, by showing a chemical in shittake could activate various components of the immune system, including Nk cells. T cells, macrophages, and interleukin-6.
Early research in the 70s already showed the benefits of shiitake mushroom in lowering cholesterol. Research conducted in Japan identified a specific amino acid in shiitake that helps speed up the processing of cholesterol in the liver. In a 1974 study (reported by Kenneth Jones in "Shiitake Medicine in a mushroom," Herbs for Health, Jan/Feb 1997), 40 elderly individuals and 420 young women consumed nine grams of dried shiitake or the equivalent amount of fresh shiitake (90g) every day for 7 days. After a week, total cholesterol levels had dropped seven to 15% in the older group, and 6 to 12% in the young women.
Like maitake, shiitake also appears to be a formidable cancer fighter. In 1969, scientists at Tokyo's National Center Research Institute isolated a polysaccharide compound from shiitake they called lentinan. In laboratory trials, lentinan caused tumors in mice to regress or vanish in 80 to 100% of the subjects. Lentinan appears to stimulate immune-system cells to clear the body of tumor cells.
What's more, shiitake appears to be effective against some of the more serious viruses we face today: HIV and hepatitis B. Test-tube studies in Japan indicate that LEM (short of Lentinula edodes myucelium), an extract of shiitake mushroom, is more lethal to HIV-infected cells that AZT, a well-known medication developed to delay the progress of AIDS. In other test-tube studies, LEM lignins have been shown to block HIV cells from reproducing and damaging helpful T cells. These lignins also stop cell damage from herpes simplex I and II, two viral infections that often plague individuals with HIV.
Hepatitis B is a liver disease transmitted through transfusions, the use of unclean needles, or other blood-to-blood contact. In the 1980s, a trial involving 16 clinics in Japan investigated the impact of LEM on hepatitis B. The studies indicated that LEM may stimulate the body to produce antibodies. Forty individuals with chronic hepatitis B ingested six grams of LEM daily for four months. All of the patients experienced relief of hepatitis B symptoms, and in 15, the virus was inactivated.
In an experiment with human colon cancer cells, shiitake exhibited strong anti-cancer properties. Immune system enhancement may not be the only possible anti-cancer mechanism of shiitake. An in vitro study revealed shittake could induce selective apoptosis in murine melanoma cells. Extracts from shiitake mushrooms (such as ichtyol) have also been researched for many other immunological benefits, ranging from anti-viral properties to possible treatments for severe allergies, as well as arthritis.
Lenthionine, a key flavour compound of shiitake, also inhibits platelet aggregation, so it is a promising treatment for thrombosis. Active Hexose Correlated Compound (AHCC) is an alpha glucan rich nutritional supplement produced from the mycelia of Lentinula edodes of the basidiomycete family of mushrooms. The immunological effect of AHCC has been studied in a double-blind, placebo-controlled study with 21 healthy volunteers.The AHCC group showed a significantly higher number of total dendritic cells compared with baseline, a significantly higher number of DC1 cells compared with baseline, a significantly higher number of DC2 cells compared with controls, and a significantly increased mixed-leukocyte reaction compared with controls. There was no significant difference in cytokine production, NK cell activity or other immune function parameters between the two groups.
Shiitake are also one of a few known natural sources of vegan and kosher vitamin D (vitamin D2).
Chemicals naturally present in shiitake have demonstrated anti-bacterial and anti-viral properties in laboratory research. An in vitro experiment on Vero cells, showed that shiitake inhibited the release of herpes simplex virus 1 (HSV-1).
Lentin, a chemical naturally occurring in shiitake, has strong anti-fungal properties and in vitro research has shown it can inhibit the human immunodeficiency virus-1. Data for shiitake's effect on human HIV treatment is extremely limited, but one study produced promising data.
Shiitake possess multiple chemicals which have demonstrated antibacterial and antiviral properties.
Researchers have identified a proteinase inhibitor in shiitake..
The Shitake mushroom lowers cholesterol and improves immune system function, good for preventing high blood pressure and heart disease, for controlling cholesterol level, building resistance against viruses, and fighting diseases such as AIDS/HIV and cancers. Often available fresh, Shitake mushrooms are very flavorful when used in cooking!
Beinfield points our that shiitake "can be used as a food as well as a medicine. It treats nutritional deficiencies and improves immunity through diet". Because of its appealing flavor and rich nutritional makeup, vegetarians sometimes use shiitake mushrooms as a substitute for animal protein.


Info from:
http://www.tbyil.com/mushrooms.htm
http://www.healthcastle.com/herb_mushroom_shiitake.shtml
http://en.wikipedia.org/wiki/Chinese_black_mushroom
and for an essay on medicinal benefits:
http://www.world-of-fungi.org/Mostly_Medical/Dawn_Soo/Dawn_Soo_SSM.htm