Because of the economical relevance of sugarcane and its high potential as a source of biofuel, it is important to understand how this crop will respond to the foreseen increase in atmospheric [CO2]. The effects of increased [CO2] on photosynthesis, development and carbohydrate metabolism were studied in sugarcane (Saccharum ssp.). Plants were grown at ambient (∼370 ppm) and elevated (∼720 ppm) [CO2] during 50 weeks in open-top chambers. The plants grown under elevated CO2 showed, at the end of such period, an increase of about 30% in photosynthesis and 17% in height, and accumulated 40% more biomass in comparison with the plants grown at ambient [CO2]. These plants also had lower stomatal conductance and transpiration rates (−37 and −32%, respectively), and higher water-use efficiency (c.a. 62%). cDNA microarray analyses revealed a differential expression of 35 genes on the leaves (14 repressed and 22 induced) by elevated CO2. The latter are mainly related to photosynthesis and development. Industrial productivity analysis showed an increase of about 29% in sucrose content. These data suggest that sugarcane crops increase productivity in higher [CO2], and that this might be related, as previously observed for maize and sorghum, to transient drought stress.