The global transition from fossil fuels to biomass-based biofuels marks a significant shift in the energy sector. This transition is motivated by the need to combat climate change, reduce environmental pollution, and enhance energy security. Biofuels are gaining importance, especially as policies favor the use of non-food feedstocks like lignocellulosic biomass. Techno-economic analysis (TEA) and life cycle assessment (LCA) offer insights into biomass conversion for biofuel production, economic feasibility, and environmental impacts, highlighting opportunities to improve biofuel economics by utilizing underutilized biomass such as agricultural crop residues and other organic wastes. A successful transition to biofuels, supported by advanced technologies such as omics-based genetic engineering, artificial intelligence (AI), and machine learning, is crucial to optimizing metabolic pathways and boosting biofuel production efficiency, making biofuels more competitive with traditional petroleum fuels. As global biofuel supply chains expand, international cooperation becomes increasingly vital, emphasizing the importance of collaboration during the energy transition. Establishing standards for sustainability, technical specifications, and trade policies is essential to guide market growth and direction. Transition from fossil fuels to biofuel systems involves various economic, technical, and policy challenges while also prioritizing environmental sustainability. Despite these challenges, progress in technology, supportive policies, and rising environmental consciousness is driving positive momentum for this significant energy transition.