Appropriate bioprocessing of lignocellulosic materials into ethanol could address the world's insatiable appetite for energy while mitigating greenhouse gases. Bioethanol is an ideal gasoline extender and is widely used in many countries in blended form with gasoline at specific ratios to improve fuel characteristics and engine performance. Although the bioethanol production industry has long been operational, finding a suitable microbial agent for the efficient conversion of lignocelluloses is still an active field of study. Among available microbial candidates, engineered bacteria may be promising ethanol producers while may show other desired traits such as thermophilic nature and high ethanol tolerance. This review provides the current knowledge on the introduction, overexpression, and deletion of the genes that have been performed in bacterial hosts to achieve higher ethanol yield, production rate and titer, and tolerance. The constraints and possible solutions and economic feasibility of the processes utilizing such engineered strains are also discussed.