The main function of labyrinth seal is to control leakage flow in clearance that involves with rotating and stationary parts. Therefore, the effective of clearance gap in labyrinth seal is critical to sealing, heat transfer and vibration characteristics. However, due to the mechanical expansions, vibrations, thermal stress, misalignment of seal components in transient periods of startup, shutdown and hot restart, the stationary and rotating parts of the labyrinth seal are likely to contact each other, causing wear damages in labyrinth fin. Mushrooming damages are often occurred in the rubbing events when labyrinth fin is made of soft material compared with the opposite component. To investigate how mushrooming damage affects the leakage performance of labyrinth seal, many numerical and experimental studies have been carried out in last decades. However, little attention has been paid on the influence of labyrinth fin mushrooming on aerodynamic performance of turbine stages. In this study, using the RANS equations solution methods, the effect of labyrinth fin mushrooming on isentropic efficiency, leakage rates, outlet flow angles, reaction degrees, profile static pressure distributions and flow fields in turbine stages were investigated at three different mushrooming radii and three effective clearances. It shows the leakage rate is increased with increasing the mushroom radius and effective clearance. At the same effective clearance, as the mushrooming radius increases from 0.2mm to 0.4mm, the leakage rate is increased by about 0.19–0.32%, and the overall isentropic efficiency is decreased by 0.78%. At the same mushrooming radius, as the effective clearance increases from 1mm to 1.4mm, the leakage rate is increased by 0.21–0.31%, and the overall isentropic efficiency is decreased by 0.65%. As mushroom radius and effective clearance increase, the secondary flows near hub and shroud are intensified and developed along axial direction, causing pronounced aerodynamic loss in turbine stages.