Leaf mulch is the result of finely shredding fall leaves. As these fine leaf shreds decompose, the nutrients and minerals contained within the leaf are released, recycled into the soil. Additionally, the finely textured mulch adds air pockets to your soil, allowing better oxygenation, as well as enhanced water retention. Leaf mulch can be left in-place on the lawn, used as a landscape bed mulch or used in a compost pile.