Sugarcane (Saccharum spp. hybrids) has great potential as a major feedstock for biofuel production worldwide. It is considered among the best options for producing biofuels today due to an exceptional biomass production capacity, high carbohydrate (sugar + fiber) content, and a favorable energy input/output ratio. To maximize the conversion of sugarcane biomass into biofuels, it is imperative to generate improved sugarcane varieties with better biomass degradability. However, unlike many diploid plants, where genetic tools are well developed, biotechnological improvement is hindered in sugarcane by our current limited understanding of the large and complex genome. Therefore, understanding the genetics of the key biofuel traits in sugarcane and optimization of sugarcane biomass composition will advance efficient conversion of sugarcane biomass into fermentable sugars for biofuel production. The large existing phenotypic variation in Saccharum germplasm and the availability of the current genomics technologies will allow biofuel traits to be characterized, the genetic basis of critical differences in biomass composition to be determined, and targets for improvement of sugarcane for biofuels to be established. Emerging options for genetic improvement of sugarcane for the use as a bioenergy crop are reviewed. This will better define the targets for potential genetic manipulation of sugarcane biomass composition for biofuels.