This paper explores the potential of the Clean Development Mechanism (CDM) of the Kyoto Protocol to promote modern bioenergy options in developing countries. The starting point is that developing countries need to be given a major role in the implementation of the Convention on Climate Change because of their increasing energy demands and the pressing need to mitigate climate change. The role of CDM is discussed in the context of sustainable development. formation of carbon markets, and promotion of bioenergy options. Besides contributing to mitigate climate change, CDM can be used to demonstrate and disseminate new technologies. reduce investment risks and enhance the cost-efficiency of projects, while also creating jobs and improving environmental conditions. In this context. bioenergy projects are attractive and CDM provides a complementary bridge for international cooperation towards sustainable development. However, since CDM is project-based, a broader policy framework is needed to integrate such projects in regional and global bioenergy systems solutions. (C) 2004 Elsevier Ltd. All rights reserved.