Bioethanol production output has increased steadily over the last two decades and is now beginning to become competitive with traditional liquid transportation fuels due to advances in engineering, the identification of new production host organisms, and the development of novel biodesign strategies. A significant portion of these efforts has been dedicated to mitigating the toxicological challenges encountered across the bioethanol production process. From the release of potentially cytotoxic or inhibitory compounds from input feedstocks, through the metabolic co-synthesis of ethanol and potentially detrimental byproducts, and to the potential cytotoxicity of ethanol itself, each stage of bioethanol production requires the application of genetic or engineering controls that ensure the host organisms remain healthy and productive to meet the necessary economies required for large scale production. In addition, as production levels continue to increase, there is an escalating focus on the detoxification of the resulting waste streams to minimize their environmental impact. Thus, this review will present the major toxicological challenges encountered throughout each stage of the bioethanol production process and the commonly employed strategies for reducing or eliminating potential toxic effects.