The first Clavulinopsis cinereoides found here were spotted by Ecological Consultant Abbie Patterson at the old Craiglockhart military hospital.
The site, which is now home to Edinburgh Napier University's Craiglockhart Campus, served as a military hospital during the First World War, famously treating poets Wilfred Owen and Siegfried Sassoon.
Ms Patterson said: "This really is a very exciting find and a first for Scotland.
"Within the UK and Europe there are very few records of this species and not a lot is known about it.
"Looking at an old photograph of First World War officers standing on the grass banking where I found the fungi, my thoughts turned to the question of how the species arrived here at all.
"I thought of the soldiers' boots trampling the devastated fields of Flanders and perhaps picking up spores and then depositing them on that grassy bank."