Levulinic acid (LA) has been identified as a platform chemical, which can be produced from lignocellulosic materials and transformed into liquid fuels, fuel additives and even other specialty chemicals. These conversions have been made possible through recent advances in heterogeneous catalysis. Taking advantage of novel chemistries and catalytic materials, we have developed a LA-based strategy to convert lignocellulosic biomass into liquid hydrocarbon fuels. To assess the economic potential of this approach, a process synthesis effort supported by detailed process simulation and capital/operational cost calculations has been undertaken. Furthermore, we study different feedstocks and perform sensitivity analysis studies for several process and economic parameters. Finally, we present the results of an energy efficiency analysis and discuss biomass transportation aspects. (C) 2011 Elsevier Ltd. All rights reserved.