This study aimed to identify the environmental impact on cocoa production and processing based on the life cycle assessment method (LCA). The major contribution of this study is to evaluate the environmental performance of a chocolate liquor in order to reveal the significant environmental hotspots along the entire supply chain. This is achieved through two main steps. First, the LCA method is applied to identify the environmental implications of managing the production and processing cocoa to become chocolate liquor. The LCA is performed based on the international ISO 14040–14043 series. Secondly, a sensitivity analysis was carried out to evaluate the impact of five proposed improvement options to discover whether any occurring potential environmental impacts will be reduced. The kind of scenarios are: reducing pesticides by 50 % (option 1); using compost instead of fertilizer (option 2); avoid burning stubble (option 3), conserving soil water (option 4) and applying alternative energy sources (option 5). As a result, the most significant environmental impact for the upstream and core processing was human toxicity potential (HTP) and cumulative energy demand (CED), 89 % and 59 %, respectively. In addition, the impact of the proposed improvement has significantly reduced environmental impacts (HTP, 68 %) and achieved savings (IDR 18800, 17.7 %). Survey data includes the entire supply chain, with a detailed focus on production and processing stages for an Indonesian chocolate company. This study only dealt with cocoa beans that generated 1 kg of chocolate liquor.