Abstract Urbanization is a major driver of global change, altering natural ecosystems and threatening biodiversity. Despite the widespread recognition of the importance of macrofungi, how urbanization affects the ecological patterns and processes of macrofungal communities remains poorly understood. We investigated the alpha and beta diversity of macrofungal assemblages from both taxonomic and functional aspects along an urbanization gradient. We further assessed the factors of urbanization and green space management in structuring macrofungal communities. Specifically, we compared macrofungal diversity patterns using nonparametric tests and assessed compositional differences with permutational multivariate analysis of variance (PERANOVA). We then examined the effects of urbanization characteristics on macrofungal alpha diversity using generalized linear mixed models (GLMMs) and estimated their impacts on various components of beta diversity through distance‐based redundancy analysis (db‐RDA) and analysis of variance (ANOVA). Urbanization significantly reduced macrofungal alpha richness in taxonomic and functional dimensions, with species and trait composition differing significantly between urban and rural assemblages. Park size showed positive correlations with species and functional richness, while intensive management demonstrated negative effects. Low‐intensity management was positively associated with functional richness. Taxonomy‐based beta dissimilarity was primarily driven by turnover, whereas trait‐based beta diversity was characterized by nestedness, with distinct drivers affecting each component. This pattern suggests that urbanization promotes species replacement with those possessing trait combinations adapted to disturbed environments. This functional convergence is shaped by habitat size and management practices, with the proportion of lawns additionally contributing to taxonomic replacement. Synthesis and applications . Our study highlights the complementary insights of combining taxonomy‐ and trait‐based alpha and beta methods for a better understanding of the assembly of urban macrofungal communities. Our study underscores that urbanization reduces alpha richness and drives beta compositional difference among assemblages. Promoting larger habitats and transitioning from intensive to extensive management, especially by preserving snags, logs, and litter layers, are effective initiatives to mitigate the negative effects of urbanization and conserve both taxonomy‐ and trait‐based macrofungal diversity. Although based on a case study, our findings reveal macrofungal diversity patterns that are relevant to urbanization, underscoring the need for further studies to test their generality.