Genetic variability can be generated by different mechanisms, and across the life cycle. Many basidiomycete fungi have an extended somatic stage, during which each cell carries two genetically distinct haploid nuclei (dikaryosis), resulting from fusion of two compatible monokaryotic individuals. Recent findings have revealed remarkable genome stability at the nucleotide level during dikaryotic growth in these organisms, but whether this pattern extends to mutations affecting large genomic regions remains unknown. Furthermore, despite high genome integrity during dikaryosis, basidiomycete populations are not devoid of genetic diversity, begging the question of when this diversity is introduced. Here, we used a Marasmius oreades fairy ring to investigate the rise of large-scale variants during mono- and dikaryosis. By separating the two nuclear genotypes from four fruiting bodies and generating complete genome assemblies, we gained access to investigate genomic changes of any size. We found that during dikaryotic growth in nature the genome stayed intact, but after separating the nucleotypes into monokaryons, a considerable amount of structural variation started to accumulate, driven to large extent by transposons. Transposon insertions were also found in monokaryotic single-meiospore isolates. Hence, we show that genome integrity in basidiomycetes can be interrupted during monokaryosis, leading to genomic rearrangements and increased activity of transposable elements. We suggest that genetic diversification is disproportionate between life cycle stages in mushroom-forming fungi, so that the short-lived monokaryotic growth stage is more prone to genetic changes than the dikaryotic stage.