In the United States, government-mandated growth in the production of crops dedicated to biofuel (agrofuels) is predicted to increase the demands on existing agricultural lands, potentially threatening the persistence of populations of grassland birds they support. We review recently published literature and datasets to (1) examine the ability of alternative agrofuel crops and their management regimes to provide habitat for grassland birds, (2) determine how crop placement in agricultural landscapes and agrofuel-related land-use change will affect grassland birds, and (3) identify critical research and policy-development needs associated with agrofuel production. We find that native perennial plants proposed as feedstock for agrofuel (switchgrass, Panicum virgatum, and mixed grass—forb prairie) have considerable potential to provide new habitat to a wide range of grassland birds, including rare and threatened species. However, industrialization of agrofuel production that maximizes biomass, homogenizes vegetation structure, and results in the cultivation of small fields within largely forested landscapes is likely to reduce species richness and/or abundance of grassland-dependent birds. Realizing the potential benefits of agrofuel production for grassland birds' conservation will require the development of new policies that encourage agricultural practices specifically targeting the needs of grassland specialists. The broad array of grower-incentive programs in existence may deliver new agrofuel policies effectively but will require coordination at a spatial scale broader than currently practiced, preferably within an adaptive-management framework.