This study uses a site-specific life cycle assessment (LCA) to evaluate the environmental profile and energy and water demand of potential production options for rapeseed biodiesel in Chile. The first step is the analysis of the biodiesel supply chain in a standard scenario, associated with the most likely production conditions. The second step is the evaluation of the following alternative scenarios related to a production strategy involving low-impact or renewable resources: (1) Addition of livestock manure as organic fertilizer, (2) Use of degraded grassland, (3) Biodiesel transport by rail, and (4) Use of forest residues for industrial steam. The results show that the biodiesel in the standard scenario has less environmental impacts than fossil diesel in 4 of the 13 indicators evaluated. The rapeseed production is the stage with the highest contribution to impacts. The scenario 1 presents the best environmental profile. The scenario 2 reduces the greenhouse gas emissions of biodiesel. The scenarios 3 and 4 moderately improve the profile of the biofuel. The four situations could be implemented in the short term, but should be backed up by economic and social studies. (C) 2011 Elsevier Ltd. All rights reserved.