In the near future hardwood may be a real alternative to oil as a raw material for production of chemicals and motor fuel. A new approach to solve this problem has been found. The aimed change of the mechanism of the process has permitted to solve two problems simultaneously: to increase the furfural yield from 55% up to 75% from the theoretical yield and to diminish 7 times the degree of cellulose destruction. On the basis of theoretical studies, a new technology including two-step hydrolysis of hardwood and other pentosan-containing raw material has been developed. Since 1997, for the first time in the world's industrial practice, this technology of yielding furfural and bioethanol has been realized in Russia with the annualy capacity of 4.300 t furfural and 11 million l bioethanol. The degree of raw material utilization has grown 3 times compared to furfural production alone.