The biofuel mix in transport in the U.K. must be increased from currently exploited 3.33% to the EU target mix of 10% by 2020. Under the face of this huge challenge, the most viable way forward is to process infrastructure-compatible intermediate, such as bio-oil from fast pyrolysis of lignocellulosic biomass, into biofuels. New facilities may integrate multiple distributed pyrolysis units producing bio-oil from locally available biomass and centralized biofuel production platforms, such as methanol or Fischer–Tropsch liquid synthesis utilizing syngas derived from gasification of bio-oil. An alternative to bio-oil gasification is hydrotreating and hydrocracking (upgrading) of bio-oil into stable oil with reduced oxygen content. The stable oil can then be coprocessed into targeted transportation fuel mix within refinery in exchange of refinery hydrogen to the upgrader. This Article focuses on the evaluation of economic and environmental sustainability of industrial scale biofuel production systems from bio-oils. An overview of bio-oil gasification-based system evaluation is presented, while comprehensive process reaction modeling (with 40 overall bio-oil hydrocracking and hydrotreating reaction steps), simulation, integration, and value analysis frameworks are illustrated for bio-oil upgrading and refinery coprocessing systems. The environmental analysis shows that the former technologies are able to meet the minimum greenhouse gas (GHG) emission reduction target of 60%, to be eligible for the European Union (EU) Directive’s 2020 target of 10% renewable energy in transport, while at least 20% renewable energy mix from an upgrader is required for meeting the EU GHG emission reduction target. Increases in the price of biodiesel and hydrogen make coprocessing of stable oils from bio-oil upgrader using refinery facilities economically more favorable than final biofuel blending from refineries and create win–win economic scenarios between the bio-oil upgrader and the refinery. The range of the cost of production (COP) of stable oil (328 MW or 0.424 t/t bio-oil), steam (49.5 MW or 0.926 t/t bio-oil), and off-gas or fuel gas (72.3 MW or 0.142 t/t bio-oil) from a bio-oil (LHV of 23.3 MJ/kg) upgrader process is evaluated on the basis of individual product energy values and global warming potential (GWP) impacts. The minimum and the maximum annualized capital charges predicted by the Discounted Cash Flow (DCF) analysis correspond to 25 operating years and 10% IRR, and 10 operating years and 20% IRR, respectively. On the basis of this DCF strategy and 1200 $/t of hydrogen and 540 $/t of biodiesel market prices, the selling prices of 259.32 $/t, 34.85 $/t, and 174.27 $/t of the stable oil, steam, and fuel gas, respectively, from the upgrader to the refinery were obtained to create win–win marginal incentive for the upgrader and refinery systems, individually. If stable oil from a bio-oil upgrader can be launched as a product potentially to be used in refinery hydrocracker (at a competitive price of 490 $/t), for the production of renewable diesel, upgrader can be operated independently, such as purchase hydrogen from vendors at competitive price, with comparative marginal incentives. The bio-oil upgraders, either stand-alone or integrated, were designed to meet desired product specifications, diesel with specific gravity 0.825 and cetane number 57 and stable oil with API 30.1 and cetane number 28.7, for coprocessing through the refinery hydrocracker, respectively.