Although, considerable emphasis has been given to increase production of horticultural produce, but the post harvest losses cause the serious concern in India. The development of new, shelf stable products from the fresh fruit/vegetable is an important consideration to reduce post harvest losses. Osmotic dehydration is one of the potential preservation techniques used as a pre-treatment before air drying for producing high quality products. Button mushroom is the most prized commodity among vegetables due to interest in their culinary, nutritional and health benefits and it ranks first in terms of popularity, production and availability in India. The effects of process parameters during osmotic dehydration such as duration of osmosis, salt concentration and temperature of brine on mass reduction, water loss and salt gain were studied. The water and salt diffusivity during osmotic dehydration were estimated. Mathematical model was also developed for prediction of osmotic dehydration kinetics. The process variables were optimized for maximum water loss and optimum salt gain using Response Surface Method. The air drying behavior was investigated for osmo-dehydrated mushroom samples.