A simultaneous lignin extraction and fibrillation (SEF) process combined with hydrothermal treatment is proposed, which provides an advanced lignin extraction prospect for a continuous biorefinery. Lignin was extracted during refining using a hydrothermally treated solid residue, which loosened the cell wall structure of biomass. The SEF process was controlled according to alcohol concentration without applying heat, pressure, and catalyst, increasing the lignin extraction rate by 2.1 times compared to the unpretreated biomass. The SEF process shortened the time from 96 to 48 h to reach a steady-state yield by improving the initial enzymatic hydrolysis rate with a significant increase in the final glucose conversion rate from 73.8 to 78.0%. Furthermore, the SEF process can produce lignin with a low molecular weight and a narrow polydispersity, benefiting the subsequent purification process by reducing the concentration of phenolic compounds and enzyme proteins in the enzymatic hydrolysate by 1/4 and 1/ 2, respectively.