, a consumable mushroom, has shown a potential to enhance the production of neuroprotective bioactive metabolites. Traumatic brain injury (TBI) often leads to cognitive, physical, and psychosocial impairments, resulting in neuroinflammation and the loss of cortical neurons. In this research, the effects of mycelium, its derivative erinacine C, along with the underlying mechanisms, were examined in terms of oxidative stress modulation and neurological improvement in a rat model of mild traumatic brain injury (mTBI). Male Sprague-Dawley rats were administered diets containing mycelium and erinacine C following experimental brain injury; these supplements were continued throughout the recovery phase. The binding activity of NF-E2-related factor 2 (Nrf2) near antioxidant genes in mixed glial cells was measured by chromatin immunoprecipitation-quantitative polymerase chain reaction (ChIP-qPCR). The motor beam walking test revealed that dietary supplementation of mycelium resulted in modest improvements in spatial memory while inhibiting neuron cell death and microglial activation according to brain histological examination. These findings were further corroborated by the upregulation of several antioxidant enzymes (catalase, glutathione reductase, thioredoxin reductase, and superoxide dismutase) and phospho-CAMP-response element-binding (p-CREB) levels in the mTBI model treated with mycelium. Erinacine C treatment led to significantly reduced brain inflammation and normalization of mTBI-induced deficits through the modulation of the Nrf2 activation pathway and upregulated expression of numerous Nrf2-binding antioxidant genes such as catalase, thioredoxin reductase, superoxide dismutase, and brain-derived neurotrophic factor. This study demonstrates the potential of mycelium and erinacine C in facilitating recovery following mTBI, including the prevention of neuronal injury and inactivation of microglia through the Nrf2-mediated antioxidant pathway in vivo.