Biofuels are clean and renewable energy resources gaining increased attention as a potential replacement for non-renewable petroleum-based fuels. They are derived from biomass that could either be animal-based or belong to any of the three generations of plant biomass (agricultural crops, lignocellulosic materials, or algae). Over 130 studies including experimental research, case studies, literature reviews, and website publications related to bioethanol production were evaluated; different methods and techniques have been tested by scientists and researchers in this field, and the most optimal conditions have been adopted for the generation of biofuels from biomass. This has ultimately led to a subsequent scale-up of procedures and the establishment of pilot, demo, and large-scale plants/biorefineries in some regions of the world. Nevertheless, there are still challenges associated with the production of bioethanol from lignocellulosic biomass, such as recalcitrance of the cell wall, multiple pretreatment steps, prolonged hydrolysis time, degradation product formation, cost, etc., which have impeded the implementation of its large-scale production, which needs to be addressed. This review gives an overview of biomass and bioenergy, the structure and composition of lignocellulosic biomass, biofuel classification, bioethanol as an energy source, bioethanol production processes, different pretreatment and hydrolysis techniques, inhibitory product formation, fermentation strategies/process, the microorganisms used for fermentation, distillation, legislation in support of advanced biofuel, and industrial projects on advanced bioethanol. The ultimate objective is still to find the best conditions and technology possible to sustainably and inexpensively produce a high bioethanol yield.