Radiata pine chips (Pinus radiata) were pretreated by steam explosion, for the simultaneous production of ethanol and pulp. Ethanol was produced fr om the depolymerized hemicellulose fraction recovered after the explosion, while kraft pulp was produced from the steam-exploded chips. The conditions that best balanced sugar recovery and fibre quality were the use of steam alone, at 220 degrees C and short reaction times (e.g. <2 min). After treatment with acid, to depolymerize short-chain oligosaccharides, the hemicellulose hydrolyzate was fermentable to ethanol by yeasts with sugar consumption above 80%. The use of steam explosion reduced the consumption of pulping chemicals. However fibre damage, although minimized significantly at lower reaction times, yielded pulps with lower physical properties than those obtained in conventional kraft pulping.