Whether or not a moldy piece of food is edible depends on the type of food. Some items are okay to eat, others can be eaten if the mold is carefully eliminated, and some should simply be thrown out. However, if the mold is growing on a soft piece of food, the item should not be eaten. Repeated ingestion of moldy food can cause serious illness, allergic reactions, and even cancer.
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There are over 100,000 different species of mold, although the exact number is unknown and is estimated to be as high as 300,000. The most famous type of mold is Penicillium chrysogenum, the mold that the first antibiotic, penicillin, was created from. Penicillium chrysogenum is commonly found in nature and on household food items, and is relatively harmless if ingested. However, when the spores are airborne, this mold can cause allergic reactions, proving that even the beneficial mold can be bad for one's health.
Though there is a wide variety of molds that can grow on food, it is nearly impossible for the average person to distinguish between the harmless types and the types that are hazardous to one's health. This is why moldy food should never be eaten; particularly if it is found on a soft food (i.e. not a hard food like salami or hard cheese, where it can be cut out).
Mold is made up of three parts--the roots, the stem and the spores. The spores are responsible for the color of the mold, and they have the ability to spread the mold and penetrate one's lungs if inhaled. However, all three distinct parts of the mold are equally dangerous if ingested.
The roots of the mold spread far beyond what the eye can see, which is why it is crucial to cut at least a one-inch in diameter area for moldy pieces of hard cheese before consumption. For soft pieces of cheese and non-cured meats, it is impossible to tell how far the mold roots have spread and the food should be immediately thrown away. Also, wash your hands after handling moldy food, as well as any utensils that may have come in contact with the moldy food.
Some types of mold are benign and will produce little to no reaction in humans, while others can be so dangerous that they can cause cancer after long-term exposure. Most commonly, exposure to or ingestion of mold will cause a temporary reaction in a person that does not last much longer than the exposure to the mold. Ingested mold will often cause symptoms such as diarrhea, vomiting, and an upset stomach.
Though consuming moldy food once is likely to cause an upset stomach, it is unlikely to do long-term harm. However, consuming moldy food repeatedly is considered very hazardous to a person's health. This is because certain types of mold create poisonous toxins known as mycotoxins (toxins produced by a fungi). The most dangerous type of mycotoxins are aflatoxins, which are extremely carcinogenic (cancer-causing). Thus, repeated ingestion of mold can eventually lead to cancer. (source: Wikipedia)
A big misconception about mold is that it's okay to eat moldy cheese. This is not the case with all cheeses, and consuming the wrong type of mold actually be very hazardous to one's health. For certain cheeses, mold is used to make the cheese, which means that it is safe to eat. These types of cheeses include Roquefort, blue cheese, Camembert, brie and Gorgonzola.
If you see mold on other types of soft cheese (other than those listed above), the entire piece of cheese should be thrown away. Hard cheeses with mold are salvageable if you cut off the moldy area, as well as a one-inch radius around the moldy section. This is to eliminate all of the mold roots that have spread beyond what is visible to the naked eye.