Second-generation biorefinery refers to the production of different types of biofuels, biomaterials, and biochemicals by using agri-based and other lignocellulosic biomasses as substrates, which do not compete with arable lands, water for irrigation, and food supply. From the perspective of transportation fuels, second-generation bioethanol plays a crucial role in minimizing the dependency on fossil-based fuels, especially gasoline. Significant efforts have been invested in the research and development of second-generation bioethanol for commercialization in both developing and developed countries. However, in different developing countries like India, commercialization of second-generation bioethanol has been obstructed despite the abundance and variety of agricultural feedstocks. This commercial obstruction was majorly attributed to the recalcitrance of the feedstock, by-product management, and marginal subsidies compared to other nations. This article reviews the major roadblocks to the viability and commercialization of second-generation biofuels, especially bioethanol in India and a few other leading developed and developing nations. This article also reviews the biomass availability, technological advancements, investments, policies, and scale-up potential for biorefineries. A thorough discussion is made on the prospects and barriers to research, development, and demonstration as well as strengths, weaknesses, opportunities, and threats for the commercialization of second-generation bioethanol.