Cellulosic crops are projected to provide a large fraction of transportation energy needs by mid-century. However, the anticipated land requirements are substantial, which creates a potential for environmental harm if trade-offs are not sufficiently well understood to create appropriately prescriptive policy. Recent empirical findings show that cellulosic bioenergy concerns related to climate mitigation, biodiversity, reactive nitrogen loss, and crop water use can be addressed with appropriate crop, placement, and management choices. In particular, growing native perennial species on marginal lands not currently farmed provides substantial potential for climate mitigation and other benefits.