Squash is often affected by a Fungal infection called Choanephora Wet Rot. It is caused by the fungus Choanephora invading the squash flower. As the flower sets fruit the fungus grows and destroys the fruit. Since the fungus enters the fruit in the flowering stage there are not sprays or treatments that are practical to prevent the infection. Flowers open daily and at different times so spraying would be next to impossible to be effective. Here's some info:
"Choanephora Wet Rot." Wet rot, caused by the fungus Choanephora cucurbitarum, is a fruit rot of summer squash.
SYMPTOMS. Fruits rot rapidly and white fungal mold appears on the infected area. With time, fruit look like a pin cushion with numerous small, black-headed pins stuck in it (Figure
. Initially, the heads are white to brown but turn purplish-black within a few days. Affected flowers, pedicels, and immature fruit become water-soaked, and a soft, wet-rot develops. An entire fruit can rot in a 24 to 48 hour period. Symptoms usually begin on the blossom end of the fruit.
PERSISTENCE AND TRANSMISSION. The fungus overwinters as a saprophyte (living on dead plant tissue) and/or in a dormant spore form (such as a chlamydospore or zygospore). In spring, fungal spores are spread to squash flowers by wind and by insects such as bees and cucumber beetles. Infection occurs through the blossom, into the fruit and stem. Development of wet rot is favored by high relative humidity and excessive rainfall.
CONTROL. There are no effective control practices available for wet rot at this time. Fungicide sprays are impractical because new blossoms open daily and need to be protected soon after development. Drip irrigation may reduce development and spread of the disease during dry seasons.