Laccase, through its versatile mode of action, has the potential to revolutionize the pulping and paper making industry. It not only plays a role in the delignification and brightening of the pulp but has also been described for the removal of the lipophilic extractives responsible for pitch deposition from both wood and nonwood paper pulps. Laccases are capable of improving physical, chemical, as well as mechanical properties of pulp either by forming reactive radicals with lignin or by functionalizing lignocellulosic fibers. Laccases can also target the colored and toxic compounds released as effluents from various industries and render them nontoxic through its polymerization and depolymerization reactions. This article reviews the use of both fungal and bacterial laccases in improving pulp properties and bioremediation of pulp and paper mill effluents. (c) 2011 American Institute of Chemical Engineers Biotechnol. Prog., 2012