AbstractA range of cellulosic raw materials in the form of agricultural crop residue was analyzed for chemical composition and assessed for potential yields of sugars through chemical pretreatment and enzymatic hydrolysis of these materials. Corn stover was used as a representative raw material for a preliminary process design and economic assessment of the production of sugars and ethanol. With the process as presently developed, 24 gal ethanol can be obtained per ton of corn stover at a processing cost of about $1.80/gal exclusive of by‐product credits. The analysis shows the cost of ethanol to be highly dependent upon: (1) the cost of the biomass, (2) the extent of conversion to glucose, (3) enzyme recovery and production cost, and (4) potential utilization of xylose. Significant cost reduction appears possible through further research in these direction