In this study, ultrasonication was investigated for hydrolysis of sweet lime peel instead of utilizing it as a pretreatment process. Ultrasonication is one of the upcoming hydrolysis techniques that can offer high reducing sugar yield in shorter times and temperature with reduced acid consumption. Optimization studies of the hydrolysis process parameters were carried out to maximize the reducing sugar yield using the Box–Behnken method. From Box–Behnken design, 46 experiments were conducted and the effect of sulfuric acid concentration, peel concentration, sonication time, temperature and amplitude of ultrasound on reducing sugar yield were investigated. Fermentation of the hydrolysate was performed using baker’s yeast and the effect of time and pH on ethanol production was studied. Maximum ethanol yield by fermentation was observed as 64%. Scanning electron micrographs revealed that the regular and compact surface of raw biomass was altered into an irregular and scattered surface as a result of pretreatment and hydrolysis, which showed the prospective feasibility of sulfuric acid assisted steam explosion pretreatment and ultrasound assisted acid hydrolysis. From the experimental study, it was observed that ultrasonication can be explored for hydrolysis of pretreated lignocellulosic biomass to obtain high reducing sugar yield for bioethanol production.