Sugarcane bagasse is one of the potential lignocellulosic feedstocks for cellulosic ethanol production. The ethanol yield depends on the efficiency of conversion of glycans and xylans to fermentable sugars without generating byproducts that are toxic to fermentative microorganisms. Ammonia fiber expansion (AFEX) is a promising pretreatment method which has been shown to improve enzymatic hydrolysis of polysaccharides in biomass. Here, the sugarcane bagasse was pretreated by AFEX and hydrolyzed by a mixture of cellulase, xylanase and β -glucosidase enzymes. Hydrolysis of bagasse was performed with high solid loading and the enzyme ratio was optimized for maximum glucan conversion at low enzyme load. Further, the fermentation of enzymatic hydrolysate of bagasse to ethanol was performed by using recombinant ethanologenic strains of yeast and bacteria. The hydrolysate as the sole source of carbon and nitrogen supported the growth of recombinant yeast and high level of ethanol production. Addition of yeast extract and peptone to the hydrolysate had no significant effect on growth rate and ethanol production.