This report summarizes the research being conducted at the Roman L. Hruska U.S. Meat Animal Research Center to convert livestock manure and crop residues into methane and a high protein feed ingredient by thermophilic anaerobic fermentation. The major biological and operational factors involved in methanogenesis were discussed, and a kinetic model that describes the fermentation process was presented. Substrate biodegradability, fermentation temperature, and influent substrate concentration were shown to have significant effects on CH4 production rate. The kinetic model predicted methane production rates of existing pilot and full-scale fermentation systems to within 15%. The 5.7 m 3 fermentor was operated at: temperatures of 45, 50 and 55°C; hydraulic retention times ranging from 12 to 4 days; mixed continuously or 2 hr/day; and fed once/day or 22 times/day. No difference in methane production rate was observed when the fermentor was mixed 2 hr/day versus continuously. The methane production rate was about 10% higher when the fermentor was fed 22 times/day compared with once/day. The highest methane production rate achieved by the fermentor was 4.7 L CH4/L fermentor•day. This is the highest rate reported in the literature and about 4 times higher than other pilot or full-scale systems fermenting livestock manures. Assessment of the energy requirements for anaerobic fermentation systems showed that the major energy requi rement for a thermophi 1 i c system was for maintaining the fermentor temperature. Of the total heating energy required, about 89 to 94% was for heating the influent slurry at an ambient temperature of 10°C. The next major energy consumption was due to the mixing of the influent slurry and fermentor liquor. Mixing amounted to 7.3% of the gross methane energy production, assuming continuous mixing. The least energy was consumed in pumping. The total energy required for mixing and pumping accounted for 10.8 to 11.3% of the gross thermal energy production. An approach to optimizing anaerobic fermentor designs by selecting design criteria that maximize the net energy production per unit cost was presented. Using this optimization technique, we estimated that a farmer-constructed and operated system would be economically feasible for beef feedlots between 1,000 to 2,000 head without a feed credit assumed for the effluent, and about 300 head with a feed credit of $60/~1g effluent total solids. Commercial "turn-key" systems are only feasible for feedlots larger than 8,000 head with no effluent credit, and feedlots between 1,000 to 2,000 head with an effluent credit of $60/t~g. Based on these results, we bel i eve that the economi cs of anaerobic fermentation is sufficiently favorable for farm-scale demonstration of this technology.