Biomass is a renewable source of carbon, which could provide a means to reduce the greenhouse gas impact from fossil fuels in the transportation sector. Recycling of carbon dioxide from the atmosphere, either by direct chemical conversion or via biomass growth based on solar energy provides the only renewable source of liquid fuels, which could displace petroleum-derived products. Fast pyrolysis is a method of direct thermochemical conversion (nonbioconversion) of biomass to a liquid product. Although the direct conversion product, called bio-oil, is liquid; it is not compatible with the fuel handling systems currently used for transportation. Upgrading the product via catalytic processing with hydrogen gas, hydroprocessing, is a means that has been demonstrated in the laboratory. By this processing, the bio-oil can be deoxygenated to hydrocarbons, which can be useful replacements of the hydrocarbon distillates in petroleum. While the fast pyrolysis of biomass is presently commercial, the upgrading of the liquid product by hydroprocessing remains in development, although it is moving out of the laboratory into scaled-up process demonstration systems.