• Biomass is a low-greenhouse-gas fuel and carbon source. • Adding external heat and hydrogen during conversion of biomass to hydrocarbon fuels doubles liquid fuel per ton of biomass. • Large-scale bio-refineries with nuclear heat and hydrogen enable economic biofuels. • Local depotes are required to densify biomass for transport to biorefinery. • Resource base with external heat and hydrogen for bio-refinery is sufficient to replace liquid fossil fuels. Liquid fossil fuels (1) enable transportation and (2) provide energy for mobile work platforms and (3) supply dispatchable energy to highly variable demand (seasonal heating and peak electricity). We describe a system to replace liquid fossil fuels with drop-in biofuels including gasoline, diesel and jet fuel. Because growing biomass removes carbon dioxide from the air, there is no net addition of carbon dioxide to the atmosphere from burning biofuels. In addition, with proper management, biofuel systems can sequester large quantities of carbon as soil organic matter, improving soil fertility and providing other environmental services. In the United States liquid biofuels can potentially replace all liquid fossil fuels. The required system has two key features. First, the heat and hydrogen for conversion of biomass into high-quality liquid fuels is provided by external low-carbon energy sources--nuclear energy or fossil fuels with carbon capture and sequestration. Using external energy inputs can almost double the energy content of the liquid fuel per unit of biomass feedstock by fully converting the carbon in biomass into a hydrocarbon fuel. Second, competing effectively with fossil fuels requires very large biorefineries—the equivalent of a 250,000 barrel per day oil refinery. This requires commercializing methods for converting local biomass into high-density storable feedstocks that can be economically shipped to large-scale biorefineries.