•The use of food-crop related biomass for 1st generation biofuel is unsustainable.•2nd generation lignocellulosic biomass are ready for full commercial exploitation.•3rd generation algal biomass represents potential renewable source.•A combination of three generations will need to be met growing energy demand. Rapid growth in both global energy demand and carbon dioxide emissions associated with the use of fossil fuels has driven the search for alternative sources which are renewable and have a lower environmental impact. This paper reviews the availability and bioenergy potentials of the current biomass feedstocks. These include (i) food crops such as sugarcane, corn and vegetable oils, classified as the first generation feedstocks, and (ii) lignocellulosic biomass derived from agricultural and forestry residues and municipal waste, as second generation feedstocks. The environmental and socioeconomic limitations of the first generation feedstocks have placed greater emphasis on the lignocellulosic biomass, of which the conversion technologies still faces major constraints to full commercial deployment. Key technical challenges and opportunities of the lignocellulosic biomass-to-bioenergy production are discussed in comparison with the first generation technologies. The potential of the emerging third generation biofuel from algal biomass is also reviewed.