Termites do have a very important place in the ecosystem, but unfortunately they don't know the difference between our homes or a dead tree in the forest. Unlike most other insects that tunnel and live in wood, termites actually eat the wood too. Thanks to bacteria contained in their digestive system, they are able to digest cellulose (the woody part of plants). Termites play an important role in a woodland ecosystem by returning nutrients and carbon back into the soil. The termites' intestinal bacteria produce small amounts of methane gas.