To support global economic growth while also striving to limit environmental degradation, sustainable and renewable energy is critically needed. Increasing atmospheric CO2 concentration, a major contributor to climate change, can be attributed to fossil fuels consumption. Since the largest share of CO2 released into the atmosphere is by the transportation industry, alternate sources of liquid fuels are desperately needed. Biomass (macro and micro) produced by photosynthesis (natural sink for CO2), is an attractive feedstock for the production of liquid fuels and industrial chemicals without interfering with food supply. Although the technology exists today for producing transportation fuels from lignocellulosic biomass, lack of an economically viable industrial process limits the use of this resource for replacing fossil fuels. An integrated biorefinery incorporating simple process steps and utilizing all components of the biomass for value-added products is needed. This communication discusses technical challenges in achieving such an economically viable bio-based fuel and chemical industry.