AbstractTo evaluate the biofuel potential of bagasse, an abundant co-product in sugarcane-based industries, the effect of steam explosion on the efficiency of enzymatic saccharification and anaerobic digestion was studied. Bagasse was steam exploded at four different severity levels, and the impact of pretreatment was evaluated by analyzing the release of glucose after enzymatic saccharification with Cellic CTec2 and by analyzing methane production during anaerobic batch digestions. Increasing the severity of pretreatment led to degradation of xylan and the formation of pseudo-lignin. The severity of pretreatment was correlated with the enzymatic release of glucose; at optimal conditions, > 90% of the glucan was released. The highest methane yield (216 mL/gVS) was 1.3 times higher than the yield from untreated bagasse. More importantly, the pretreatment dramatically increased the rate of methane production; after 10 days, methane production from pretreated material was approximately twice that of the untreated material. To assess the possibility of developing combined processes, steam-exploded bagasse was enzymatically pre-hydrolyzed and, after the removal of released sugars, the remaining solid was subjected to anaerobic digestion. The results indicated that, in terms of total heating value, combined ethanol and biogas production is as beneficial as producing only biogas.