Ethanol is one of the bio-energy sources with high efficiency and low environmental impact. Various raw materials have been used as carbon source for ethanol production. In the present study, one varieties of potato that is, Kufri Bahar (KB) flour was chosen as a carbon source. In order to obtain maximum conversion of starch into fermentable sugar, optimum parameters for the liquefaction were determined as 104 to 105°C, 0.15% v/w of α-amylase enzyme solution (300 U/ml) and 30 g dry-weight potato mash/100 ml distilled water, respectively with a 68.86% loss in dry weight during the process. For saccharification process, the optimum dose of amyloglucosidase was 0.35% w/v (300 U/ml) with 16.95% glucose production at pH 5.0 and temperature 60°C after 1 h. The maximum ethanol concentration 7.89% (v/v) was obtained with 10% inoculum size at pH 6.0 after 48 h. Furthermore, out of the three nitrogen (yeast extract, peptone and ammonium sulphate) sources tested for ethanol production, peptone at 1.5 g/l was found to be best (7.58%). In conclusion, this study demonstrates the potential utilization of potato powder for ethanol production.