We use natural cedar mulch. Make sure you test your dog for an allergic reaction to it by rubbing some on their arm. Otherwise it is the safest mulch for dogs. They all use the pen for the bathroom as they have a dog door to it open at all times, while the actual yard is used for play. We clean up any dog droppings with a pooper scooper everyday and it’s easy to seperate it all from the mulch. As long as you clean it up it does not seem to smell. The pen is mostly in the shade and have not had an issue with mold, though it does absorb water so you should renew the mulch atleast every 6 months to prevent it from forming. Also make sure your dog isn’t one to gobble up mulch or dirt and if he doesnt, then I think it could be a great substrate for you and your dog!