The possibility of using two by-products of the sugar cane industry, molasses and bagasse steam explosion liquor (SEL), for lignin peroxidase (LiP) production by Phanerochaete chrysosporium was investigated. For comparison, the fungus was initially cultivated in synthetic media containing either glucose, sucrose, xylose, or xylan as sole carbon sources. The effect of veratryl alcohol (VA) was also investigated in relation to the enzyme activity levels. Results showed that sucrose was not metabolized by this fungus, which precluded the use of molasses as a carbon source. Glucose, xylose, and xylan promoted equivalent cell growth. Enzyme levels in the absence of VA were lower than 28 UI/L and in the presence of VA reached 109 IU/L with glucose and 85 IU/L with xylose or xylan. SEL was adequate for P. chrysosporium Lip production as LiP activity reached 90 IU/L. When VA was added to this medium, enzyme concentration increased to 155 IU/L.