Generation of biofuels from sugars in lignocellulosic biomass is a promising alternative to liquid fossil fuels, but efficient and inexpensive bioprocessing configurations must be developed to make this technology commercially viable. One of the major barriers to commercialization is the recalcitrance of plant cell wall polysaccharides to enzymatic hydrolysis. Biomass pretreatment with ionic liquids (ILs) enables efficient saccharification of biomass, but residual ILs inhibit both saccharification and microbial fuel production, requiring extensive washing after IL pretreatment. Pretreatment itself can also produce biomass-derived inhibitory compounds that reduce microbial fuel production. Therefore, there are multiple points in the process from biomass to biofuel production that must be interrogated and optimized to maximize fuel production. Here, we report the development of an IL-tolerant cellulase cocktail by combining thermophilic bacterial glycoside hydrolases produced by a mixed consortia with recombinant glycoside hydrolases. This enzymatic cocktail saccharifies IL-pretreated biomass at higher temperatures and in the presence of much higher IL concentrations than commercial fungal cocktails. Sugars obtained from saccharification of IL-pretreated switchgrass using this cocktail can be converted into biodiesel (fatty acid ethyl-esters or FAEEs) by a metabolically engineered strain of E. coli. During these studies, we found that this biodiesel-producing E. coli strain was sensitive to ILs and inhibitors released by saccharification. This cocktail will enable the development of novel biomass to biofuel bioprocessing configurations that may overcome some of the barriers to production of inexpensive cellulosic biofuels.