Lignin is a promising feedstock for the production of biofuels due to its availability (15-30 wt % of wood-based biomass) and markedly lower oxygen content than polysaccharides. [1] Considerably more efforts have been paid to the conversion of polysaccharides; [2] nevertheless, the development of ligninbased biofuels is attracting increased attention. Current strategies to produce biofuel from lignin are typically based on two-step processes, in which lignin is first depolymerized into a mixture of simple aromatic compounds (mostly phenols) either by hydrogenation, [3] alkaline [4] or acid [5] hydrolysis, or fast pyrolysis, [6] which is then followed by upgrading into fuels, preferably by hydrodeoxygenation into alkanes. Many advances have been made in the degradation of lignin into phenols; for example, phenolic fractions can be readily obtained by fast pyrolysis from pure lignin [3c,d, 6a] or directly from wood biomass, [6b-e] the latter now being a commercialized process.[7] The second step, that is, the transformation of phenolic compounds into hydrocarbon fuels or other chemicals remains a challenge.[8] The conventional hydrodeoxygenation process based on NiMo and CoMo sulfite catalysts is potentially problematic due to sulfur contamination, coke accumulation, and water-induced catalyst deactivation.[9] Recently, aqueous-phase catalytic systems that convert phenolic compounds into alkanes in a series of hydrogenation and dehydration reactions have been reported (Scheme 1), [10, 3e] which overcome the problems encountered with conventional catalytic systems. While the new system is ideally suited for lignin-based phenolic substrates, it contains several intrinsic limitations-the most obvious is that a dehydration reaction takes place in water. In fact, a previous case study on the dehydration reaction of cyclohexanol to cyclohexene showed that at 100 8C the equilibrium is > 50 % cyclohexanol in water and decreases dramatically to 2 % when the water content in the system is reduced to 10 %.[11] Consequently, high reaction temperatures exceeding 250 8C are required in aqueous systems, which not only implies demanding process engineering, but also high energy consumption.The use of ionic liquids (ILs) could, in principle, overcome these problems as well as maintain the advantages of a waterbased system (high efficiency, phase separation, etc.). Indeed, ILs have been shown to be promising solvents in biofuel production, especially in the transformation of cellulose [12] and in the production of biodiesel.[13] Nevertheless, examples of lignin-based fuel production in ILs remain scarce.[14] Here, we describe the development of a bifunctional catalytic system based on metal nanoparticles (NPs) and ILs, which can effectively convert lignin-derived phenols into alkanes under mild conditions.As can be seen in Scheme 1, the reaction pathway includes catalyzed hydrogenations and a dehydration step that is catalyzed by a Brønsted acid. Following Duponts pioneering work, [15] many notable examples of hydrogenation react...