A two-stage process was successfully developed for biodiesel and ethanol production from corn stover using zygomycetes fungus Mucor indicus. Dilute-acid pretreatment followed by enzymatic saccharification was applied to release the maximum amount of sugars (glucose and xylose) from the lignocellulosic structure of corn stover. Dilute-acid hydrolysis was optimized by a response surface design. Under the optimal reaction conditions (i.e., 1.8% v/v H2SO4, 121 °C for 22 min), the hydrolysis resulted in the production of 270 g glucose per kg of dry corn stover (57.8% theoretical yield) and 100 g xylose per kg of dry corn stover (84.0% theoretical yield). Validation of the model exhibited proper fit between predicted and observed values of glucose and xylose concentrations: 91.4% regression adjustment for xylose and 98.2% for glucose. In the first stage, cells fermented the enzymatic hydrolysate to the maximum amount of 74.5% (0.38 g g−1) ethanol as the main product. In the second stage, the dilute-acid hydrolysate was used for lipid accumulation in the fungal cells of the first stage fermentation. The hydrolysates were used without detoxification since the fungus is among the most resistant microorganisms to the inhibitors available in the acid hydrolysates. Effects of addition of different nutrient sources, including fungal extract and yeast extract along with mineral salts, were also investigated to maximize lipid yield. Overall, 21.4 g ethanol and 2.2 g biodiesel (obtained from 4.00 g accumulated lipid) were produced from 100 g dry corn stover.</p