A biodegradable sheet is produced from an aqueous dispersion containing finely cut cellulose fibers and chitosan. The dispersion is maintained at a temperature T.sub.1 .degree.C. which is within the following range:t.ltoreq.T.sub.1 .ltoreq.t+30wherein t is the boiling point (.degree.C.) of water at a given reduced pressure and is continuously introduced into a defoaming zone maintained at the given reduced pressure and at a temperature within the same range as that of T.sub.1. In the defoaming zone, the dispersion is formed into a downwardly flowing laminar flow so that air entrapped therein is effectively removed therefrom. The defoamed dispersion is then passed through a die and is molded into a sheet which is subsequently dried.