Over the past three decades significant efforts have been made towards the conservation of fossil-based fuels and the exploration and exploitation of new renewable sources. The focus primarily has been on the outlook for alternatives to the petroleum products. In this spectrum alcohol manufacture from biomass has attracted a large attention all over the world which could be used as an alternative source to petrol or in blends with petrol. The National Research Council (NRC) has substantially emphasized on the reduction of CO2 emissions and the other so-called green house gases. The NRC committee also recommends better evaluations of the processes for converting the biomass/lignocellulosic wastes to ethanol that will lessen the U.S. dependence on foreign oil. Among the factors behind the move to bio-based materials are the environmental concerns, the availability of abundant, renewable agricultural and forest resources that are both inexpensive and under-utilized. This paper provides a comprehensive review of the ethanol fermentation from the food crops as well as the lignocellulosic materials. Different processes involved including acid and enzymatic hydrolysis, enzyme production, fermentation, and lignin conversion are discussed. Also the energy balance considerations of the process are elucidated.