The impact on climate of future land use and energy policy scenarios is explored using two land- use frameworks: (i) Pure Cost Conversion Response (PCCR), or ‘extensification’, where the price of land is the only constraint to convert land to agricultural production, including growing biofuels, and (ii) Observed Land Supply Response (OLSR), or ‘intensification’, where legal, environmental and other constraints encourage more intense use of existing managed land. These two land-use frameworks, involving different economic assumptions, were used to explore how the large-scale plantation of cellulosic biofuels to meet global energy demand impacts the future climate. The land cover of the Community Atmospheric Model Version 3.0 (CAM3.0) was manipulated to reflect these two different land use and energy scenarios (i.e. biofuels and no biofuels). Using these landscapes, present and future climate conditions were simulated to assess the land cover impact. In both the intensification and extensification scenarios, the biofuel energy policy increases the land reflectivity of many areas of the globe, indicating that biofuel cropland is replacing darker land-vegetation, which directly leads to cooling. Moreover, the extensification framework—which involves more deforestation than the intensification framework—leads to larger increases in the reflectivity of the Earth’s surface and thus a stronger cooling of the land surface in the extratropics. However, the deforestation which occurred in the tropics produced an increase in temperature due to a decrease in evaporative cooling and cloud cover, and an increase in insolation and sensible heating of the near surface. Nevertheless, these surface-air temperature changes associated with land use are smaller than the effect from changes in the trace-gas forcing (i.e. the enhanced greenhouse effect), although over some regions the land-use change can be large enough to counteract the human-induced, radiatively forced warming. A comparison of these biogeophysical impacts on climate of the land use and biofuel policies with the previously published biogeochemical impact of biofuels indicates the dominance of biogeophysical impacts at 2050.