Production of bioethanol from forest and agricultural products requires a fermenting organism that converts all types of sugars in the raw material to ethanol in high yield and with a high rate. This review summarizes recent research aiming at developing industrial strains of Saccharomyces cerevisiae with the ability to ferment all lignocellulose-derived sugars. The properties required from the industrial yeast strains are discussed in relation to four benchmarks: (1) process water economy, (2) inhibitor tolerance, (3) ethanol yield, and (4) specific ethanol productivity. Of particular importance is the tolerance of the fermenting organism to fermentation inhibitors formed during fractionation/pretreatment and hydrolysis of the raw material, which necessitates the use of robust industrial strain background. While numerous metabolic engineering strategies have been developed in laboratory yeast strains, only a few approaches have been realized in industrial strains. The fermentation performance of the existing industrial pentose-fermenting S. cerevisiae strains in lignocellulose hydrolysate is reviewed. Ethanol yields of more than 0.4 g ethanol/g sugar have been achieved with several xylose-fermenting industrial strains such as TMB 3400, TMB 3006, and 424A(LNF-ST), carrying the heterologous xylose utilization pathway consisting of xylose reductase and xylitol dehydrogenase, which demonstrates the potential of pentose fermentation in improving lignocellulosic ethanol production.