Biofuel and bioenergy systems are integral to most climate stabilization scenarios for displacement of transport sector fossil fuel use and for producing negative emissions via carbon capture and storage (CCS). However, the net greenhouse gas mitigation benefit of such pathways is controversial due to concerns around ecosystem carbon losses from land use change and foregone sequestration benefits from alternative land uses. Here, we couple bottom-up ecosystem simulation with models of cellulosic biofuel production and CCS in order to track ecosystem and supply chain carbon flows for current and future biofuel systems, with comparison to competing land-based biological mitigation schemes. Analyzing three contrasting US case study sites, we show that on land transitioning out of crops or pasture, switchgrass cultivation for cellulosic ethanol production has per-hectare mitigation potential comparable to reforestation and severalfold greater than grassland restoration. In contrast, harvesting and converting existing secondary forest at those sites incurs large initial carbon debt requiring long payback periods. We also highlight how plausible future improvements in energy crop yields and biorefining technology together with CCS would achieve mitigation potential 4 and 15 times greater than forest and grassland restoration, respectively. Finally, we show that recent estimates of induced land use change are small relative to the opportunities for improving system performance that we quantify here. While climate and other ecosystem service benefits cannot be taken for granted from cellulosic biofuel deployment, our scenarios illustrate how conventional and carbon-negative biofuel systems could make a near-term, robust, and distinctive contribution to the climate challenge.