The application of enzyme in dye removal attracted considerable attention and shown its potential in recent years but the low stability and high production cost of enzyme are the key factors of the application. Tap water was used as solvent to extract the crude enzyme in this study to reduce the production cost. In order to optimise the yield of crude enzyme extract from spent P. ostreatus substrate, parameter such as suspended time duration of spent P. ostreatus substrate in tap water, agitation time and speed in incubator shaker were investigated. The effect of dye concentration, enzyme concentration, pH and temperature in Methylene blue and Rhodamine B removal using crude enzyme extracted were investigated. Bradford test was done to determine the presence of protein in the crude enzyme extracted and Fourier Transform Infrared Spectroscopy (FTC) was used to determine the presence of functional group in crude enzyme extract. As a result, the optimum parameter to yield crude enzyme is 120 minutes of suspended time, 90 minutes of agitation time at 200 rpm agitation speed. Methylene blue shown the highest dye removal efficiency at 84.23% and Rhodamine B shown low dye removal efficiency <17%. Crude enzyme extracted from spent P. ostreatus substrate is efficient to remove Methylene blue but not efficient to remove Rhodamine B.