Will momentarily shrink you when eaten.
+1 for retrieval, +3 when eaten.
You can only get the mushroom by entering from the east (B1) and the only way to do that is by catching a ride from the condor. Once dropped by the condor, go to the left before dropping into the hole and you will be on the eastern show by the mushroom. The mushroom is circled in the above.
Don't go into the hole in B1 until you have the mushroom or you will not be able to complete the game. Don't use the mushroom until you have to exit the Leprechaun Cave, it's effects last only a few seconds.
You can not get the mushroom until near the very end of the game, so don't worry about it initially.