Why are fungi unable to live in dry areas?

Moisture in environment is required by fungi to carry saprophytic nutrition

Explanation:

Fungi are saprophytes and they need an environment which has moisture so that they can feed on dead remains of plants and animals by decomposing them. If fungi live in association with algae, survival of algae in dry place is essential but since water is the prime requirement of algae to produce food for both itself and the fungi.

Also the locomotion of fungi is hampered in a dry place. Fungi have flagella which face issues in movement in dry places. Also the reproduction of fungi is hampered as spores forms during asexual reproduction need moisture in the environment to mature and survive.  

Thus, it is impossible for a fungi to survive in a dry place.