Even though you may be used to it, musty smells in your basement are not normal, and can be a sign of water penetration that can lead to more serious problems. Musty smells are indicative of mold growth. When mold is reproducing, it releases a gas and that is the cause of the musty or mildew odors. Mold thrives in dark, moist environments where organic materials are present. This is the reason basements and crawl spaces are perfect places for mold to grow. Dust mites also love humid environments because they absorb the water out of the air. If you have a mold problem in your basement or crawl space, it will also affect the comfort and health of your upstairs living space. Mold spores and dust mites can irritate allergies and asthma.