Technical and economic analysis was done for the biomass to dimethyl ether (DME) technology to promote the gasification/synthesis route for biofuel production and its application as a fossil fuel substitute. The technology of biomass gasification/synthesis has obvious advantages, including production flexibility, environmental friendliness, economic feasibility, and application versatility. Biomass gasification/synthesis technology integrates bio-DME synthesis, fertilizer production, electricity generation, and waste heat utilization to convert waste biomass residues to DME for use as liquid petroleum gas, transportation fuel substitute, and chemical intermediates, which has been proven to be one of the most effective and clean biomass utilization routes. The 1000 t/a-scale demonstration plant has a bio-DME production rate of 6 to 7 / , biomass gasification efficiency of≥82%, once-through CO conversion of ≥70%, DME selectivity (DME/DME+other organic products) of ≥90%, and a total system efficiency of ≥38%. The demonstration plant also has self-sufficient steam and electricity supply. The 10,000tons/a-scale bio-DME production cost with or without feedstock subsidy is estimated to be 1968 Yuan/t and 2868 Yuan/t, respectively in China. Because of the limitation in biomass feedstock collection cost, massive and disperse commercial plants with a capacity of 10000 t/a bio-DME are more suitable for rural areas.