The need for alternative, renewable fuels has driven a resurgence in biofuel research, particularly from non-food crop materials. The production of fuels from lignocellulosic biomass, such as Miscanthus, creates new opportunities for engineering microorganisms and developing advanced fermentation strategies. As a member of the Energy Bioscience Institutes, my thesis focuses on studying and alleviating toxicity of biofuels and hydrolysate to fuel-producing microorganisms. As biofuels (i.e., short- and long-chain alcohols) intercalate into the membrane, they are thought to increase membrane fluidity, decrease the membrane potential for pH control, and denature transmembrane proteins. The organism uses various mechanisms, such as changes in lipid composition and increased expression of chaperones, to respond to the stress. Previous research has indicated that membrane properties, particularly fluidity and lipid composition, are responsible for a microorganism's tolerance to alcohols. To address membrane integrity as a function of inhibitor (ethanol, n-butanol, or isobutanol) concentration, we studied the growth, lipid composition, and membrane fluidity of yeasts, archaea, and bacteria. The specific growth rates of each organism decreased with increasing alcohol concentrations; however, the growth rates of some organisms decreased much less than others over the range of alcohol concentrations tested. The lipid composition of organisms grown in an amount of alcohol that inhibited growth by 50% and 85% was analyzed for changes in unsaturated to saturated lipid ratios (or branched to unbranched ratios for organisms that do not produce unsaturated lipids). Using fluorescence anisotropy techniques, the membrane fluidity of whole cells was tested in different concentrations of inhibitors. No clear correlations between growth rates, lipid composition, and membrane fluidity could be established. Instead, each organism responded to the presence of alcohols differently, indicating that lipids may play a less prominent role in alcohol tolerance than previously thought. Understanding how alcohols affect cellular machinery, including proteins within the membrane, will provide greater insight into how microorganisms respond to alcohols. The breakdown of lignocellulose for biofuel production often requires high temperature and chemical pretreatment, releasing lignin monomers and degraded sugar products that inhibit cell growth. These inhibitors, such as furfural, acetic acid, and 5-hydroxymethyl furfural, negatively impact cell metabolism and biofuel production. While the tolerance to these and other individual compounds by Saccharomyces cerevisiae has been studied previously, tolerance levels fail to transfer to real hydrolysates that contain combinations of these inhibitors. To gain insight into the complex phenotype of hydrolysate tolerance, experimental evolution was used to improve inhibitor tolerance and biofuel production of S. cerevisiae in the presence of liquor from dilute-acid pretreated Miscanthus. To improve tolerance towards liquor, S. cerevisiae was grown in continuous culture with increasing concentrations of liquor in the feed medium (up to 85% (v/v) before washout occurred). Tolerant mutants were isolated from the continuous culture for genomic re-sequencing to identify mutations that confer liquor tolerance. The results from this study provide insights into the complex phenotype of hydrolysate tolerance, and will be used to improve the tolerance of biofuel-producing yeast strains.