Think any of us who start plants from seed have experienced this CURSE at one time or another. Damping-off is caused by a fungus that attacks sprouting seeds and young seedlings that rot off at their bases and just fall over, and the fungus can attack at any time. What to do to avoid this: use ground or milled sphagnum moss across the flats (of cells) or inbetween rows of seeds. Because of the high acidity content in the moss, it helps fight fungal problems, keeps the fungus from developing. Simply sprinkle about 1/4 inch of ground sphagnum moss in between rows of seeds, or lightly dust it across the entire tops of trays/cells at seeding time. Regular sphagnum moss can be used, just rub between hands or fingers to grind it, or put it through a blender on the "pulse" speed til broken down. This information came from another gardening site, was too good not to pass on. I use milled sphagnum moss in my seed starting mix (2 parts moss; 1 part fine perlite; 1 part fine vermiculite), top off lightly fertilized soil below with the blend, plant seeds directly in it. Get quick germination and no sign of damping-off. Hope this is helpful to seed starters.
There is a very definite 'down' in Britain on the use of Sphagnum moss in any shape or form as its extraction is leading to the loss of major important wildlife habitats. I have to say that I have never needed to use this method to avoid damping off. Sowing thinly and watering once with Copper sulphate solution (Cheshunt compound) has been enough to stop it.
Sorry, Palustris, for rather "stepping on your toes" there, maybe should clarify a few things about sphagnum moss for you. In the Countries where it's harvested to supply commercial/hobbyist growers with the finished product, it's regarded as a renewable/sustainable resource, is treated as such. Bogs, where it grows, are..basically.."hand picked" at harvest time, are not totally destroyed and left devoid of the plant! Instead, some are left for "seed" and harvests only occur once every three years to allow regrowth. Australia; South America; Wisconsin, USA; and CANADA (with peat moss: do research the differance) are some of the major harvestors that export worldwide. New Zealand's experimenting with growing sphagnum moss in glass houses for commercial use! So, as you can see, the taking/using of this natural product isn't damaging the landscapes, and if you've ever seen a "peat bog", nothing much really survives in/around them because of the acidity factor involved in the growing plant itself, the decomposing ones turning into PEAT. I fully "stand by" my recommendation for it's use in curbing damping-off, and the seed starting mixture I mentioned.
I did not say that I was in agreement with the anti peat use people in Britiain, I merely mentioned that they exist.
ground sphagnum moss does work, we opt for a easier-cheaper method, and one that hasn't let Us down... Cinnamon...sprinkled on the potting medium around the plants. we start over a thousand seedlings each year, with zero loss to fungus