Biofuels represent a significant challenge and opportunity for agriculture. Producing liquid fuels from cellulosic biomass affords a number of potential environmental benefits. Biofuels result in lower greenhouse gas emissions than fuels derived from petroleum. Growing perennial biomass crops reduces soil erosion and sequesters more carbon than annual crops grown for grain or biomass. Corn and sorghum are crops that have high near-term potential as annual biomass crops. Dedicated biomass crops with very high yields will produce more fuel per acre, helping to balance land for food and fuel. Switchgrass and Miscanthus are perennial species that have been broadly evaluated as potential biomass crops, but will benefit from further development for widespread use. New crops and cropping systems developed specifically for bioenergy production will be necessary to meet biofuel production targets. Bioenergy crops should be developed that use inputs efficiently, have high and stable productivity, have positive environment impact, and are compatible with existing cropping systems. Most importantly, biomass crop portfolios must be developed that allow for sustained energy supply throughout the year.