Mushrooms are different colors based on the time of day you pick them: red for day, green for dusk, blue for night. Eating any type of mushroom (raw or cooked) helps one stat and harms one stat (health, hunger, sanity). Raw blue caps, which improve both health and hunger at the cost of sanity, are the exception. Eating combinations of mushrooms will help offset the negative effects. Red caps can be used to damage animals and monsters or fed to some animals to produce manure for farming.