The projected cost of ethanol production from cellulosic biomass has been reduced by almost a factor of four over the last 20 yr. Thus, it is now competitive for blending with gasoline, and several companies are working to build the first plants. However, technology development faced challenges at all levels. Because the benefits of bioethanol were not well understood, it was imperative to clarify and differentiate its attributes. Process engineering was invaluable in focusing on promising opportunities for improvements, particularly in light of budget reductions, and in tracking progress toward a competitive goal. Now it is vital for one or more commercial projects to be successful, and improving our understanding of process fundamentals will reduce the time and costs for commercialization. Additionally, the cost of bioethanol must be cut further to be competitive as a pure fuel in the open market, and aggressive technology advances are required to meet this target.