Answer:
Applying tea tree oil (diluted to 25% or 50% with ethanol and polyethylene glycol) topically to the feet (typically twice daily) has been shown to be somewhat effective (about 60% cure rate) in treating foot fungus (known as athlete's foot, tinea pedis, or "ringworm" due to the lesion that can occur) (Satchell, Australas J Dermatol 2002).
Tea tree oil can be as effective as some of the older over-the-counter antifungal treatments such clotrimazole (Lotrimin). However, it is unlikely to be as effective as the newer antifungal terbinafine (Lamisil), which has >80% efficacy and is also available over-the-counter (Patel, Australas J Dermatol).
Be aware some people may experience allergic inflammation of the skin from tea tree oil.
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