Fuel ethanol can be produced from softwood through hydrolysis in an enzymatic process. Prior to enzymatic hydrolysis of the softwood, pretreatment is necessary. In this study two-step steam pretreatment by dilute H2SO4 impregnation to improve the overall sugar and ethanol yield has been investigated. The first pretreatment step was performed under conditions of low severity (180degreesC, 10 min, 0.5% H2SO4) to optimise the amount of hydrolysed hemicellulose. In the second step the washed solid material from the first pretreatment step was impregnated again with H2SO4 and pretreated under conditions of higher severity to hydrolyse a portion of the cellulose, and to make the cellulose more accessible to enzymatic attack. A wide range of conditions was-used to-determine the most favourable combination. The temperatures investigated were between 180degreesC and 220degreesC, the residence times were 2, 5 and 10 min and the concentrations of H2SO4 were 1% and 2%. The effects - of pretreatment were assessed by both enzymatic hydrolysis of the solids and with simultaneous saccharification and fermentation (SSF) of the whole slurry, after the second pretreatment step. For each set of pretreatment conditions-the liquid fraction was fermented to determine any inhibiting effects. The ethanol yield using the SSF configuration reached 65% of the theoretical value while the-sugar yield using the SHF configuration reached 77%. Maximum yields were obtained when the second pretreatment step was performed at 200degreesC for 2 min with 2% H2SO4. This form of two-step steam pretreatment is a promising method of increasing the overall yield in the wood-to-ethanol process.