Bio-oil derived from fast pyrolysis of lignocellulosic materials is among the most complex and inexpensive raw oils that can be produced today. Although commercial or demonstration scale fast pyrolysis units can readily produce this oil, this industry has not grown to significant commercial impact due to the lack of bio-oil market pull. This paper is a review of the challenges and opportunities for bio-oil upgrading and refining. Pyrolysis oil consists of six major fractions. (water 15-30 wt.%, light oxygenates, 8-26 wt. %, mono-phenols, 2-7 wt.%, water insoluble oligomers derived from lignin 15-25wt.%, and water soluble havey molecules 10-30 wt.%). The composition of water soluble oligomers is relatively poorly studied. In the 1880s bio-oil refining (formally known as wood distillation) targeted the separation and commercialization of C1-C4 light oxygenated compounds to produce methanol, acetic acid and acetone with the commercialization of the lignin derived water insoluble fraction for preserving purification techniques. Strategies for biofuels production are discussed in section four. Bio-oil derived products are discussed in the last section. 2. Bio-oil Composition The study of bio-oil chemical composition has been the subject of active research in the last twenty years 2,24-35. Pyrolysis oil contains numerous oxygenated compounds, which include carboxylic acids, water, alcohols, esthers, anhydrosugars, furanics, phenolics, aldehydes, and ketones covering a wide range of molecular weights and functionalities 2,24,29,30,36-41. The specific composition is directly related to the feedstock and the conditions used in their production 42-44. Water is typically quantified by Karl Fischer titration 2 and is the most abundant bio-oil compound accounting between 15 and 30 wt. % 2 (See Figure 1). Water forms mostly from dehydration reactions of carbohydrate depolymerized products in the liquid intermediate 44. Gas Chromatography/Mass Spectroscopy (GC/MS) is by far the most common technique for the quantification of the pyrolysis oil organic volatile fraction 2,24,27,45. GC/MS detectable compounds typically account for between 30 and 40 wt. % 2. Table 2 shows the range of compounds quantified by GC/MS reported in the literature. Only four molecules (glycoaldehyde, acetic acid, acetol and levoglucosan) are found in quantities sufficiently high (>5 wt. %) to justify their separation and commercialization as chemicals. Methanol can also be produced in quantities justifying its commercialization but hardwood has to be used as feedstock. The remainder of the oil if refined is likely to be commercialized as fractions (mono-phenols, pyrolytic lignin, anhydrosugars, pyrolytic humins, and hybrid oligomers). Because bio-oil consists of hundreds of compounds with concentrations below 0.5 wt. % it is desirable to express their chemical composition in terms of few chemical groups or families 24. This idea was first proposed by Hallet and Clark 46. The authors 46 modeled bio-oil evaporation rates using a model based on this characte...