The spherical polyvinylpyrrolidone (PVP) stabilized red Se NPs (PVP–Se NPs) with a mean size of ∼45 nm were prepared via upgraded one-step wet chemical reduction by L-cysteine, which considerably shortened the synthesis procedure. Their morphological features were characterized by high-resolution scanning transmission electron microscopy, UV-VIS spectroscopy, and small-angle X-ray scattering method. The toxicological properties of PVP-Se NPs were analyzed by colorimetric cell viability assay based on the reduction of a yellow tetrazolium salt (XTT) in mitochondria, a further assay based on the measurement of lactate dehydrogenase (LDH) release from damaged cell membrane, and finally by cell proliferation assay. The antifungal effect of PVP-Se NPs alone, or in a mixture of commercial fungicide containing 2% of boric acid, 2% alkylbenzyldimethylammonium chloride, and ∼0.9% ethanolamine in distilled water was tested on the brown-rot fungus Serpula lacrymans The fungus belongs to important basidiomycetes causing economically significant decay of wood, mainly in houses and particularly cold soil cellars. The average mass loss tests performed on spruce wood blocks after four months of inoculation with S. lacrymans showed an enhanced antifungal effect of the mixture of PVP-Se NPs with a commercial fungicide than a PVP-Se NPs or commercial fungicide alone, which proved their synergistic effect on inhibiting fungi growth. Finally, scanning electron microscopy analysis of outer and inner parts of wood blocks treated with our novel mixture was performed.