Biofuels are often forecast to provide significant reductions in the greenhouse gas (GHG) emissions from the transportation sector globally. Many countries have regarded bioenergy development as a solution to both climate change mitigation and foreign energy dependence. It is projected that biofuel production may contribute up to a quarter of transportation fuel supply by 2050. But uncertainties and concerns still remain with respect to the environmental performance of biofuels, including their contribution to GHGs. Life cycle assessment (LCA) is a powerful tool for evaluating the environmental impacts of emerging technologies. However, existing LCAs are inconsistent in their selection of system boundaries, modeling assumptions, and treatment of co-products, which lead to wide variations in results, and make the comparisons of biofuel pathways challenging. Co-products usually play an essential role in biofuel production system, both economically and environmentally. Thus the treatment strategies of co-product are considered critical to LCA results. Studies presented in this dissertation assess several types of biofuels, including first generation, second generation and advanced biofuels, which are produced from terrestrial feedstocks (e.g., corn grain and corn stover) and algae. A variety of researchers have identified the importance of treating co-products in LCAs. This study focuses on the improvement of LCA methodology for assessing biofuel co-products. This dissertation contributes to current knowledge and methodology in following ways: 1) it develops a comprehensive life cycle energy, carbon and water model for microalgae biofuel production 2) it improves co-product allocation strategies in LCA; and 3) it explores the indirect impacts on ocean resources induced by algal oil production at large scale, which has not been examined previously.