Abstract: Pretreatment is crucial for the conversion of lignocellulose to biofuels. Unlike conventional chemical/physicochemical methods, fungal pretreatment uses white-rot fungi and mild reaction conditions. However, challenges, including substrate sterilization, long duration, and low sugar yields associated with this method, contribute to lower techno-economic performance, an aspect that has rarely been investigated. This study aimed to evaluate the feasibility of fungal pretreatment of nonsterilized poplar wood. Various factors, including inoculum types, fermentation supplements, and cultivation methods, were investigated to optimize the process. A techno-economic assessment of the optimized processes was performed at a full biorefinery scale. The scenario using nonsterilized wood as a substrate, precolonized wood as an inoculum, and a 4 week pretreatment showed a 14.5% reduction in sugar production costs (€2.15/kg) compared to using sterilized wood. Although the evaluation of nonsterilized wood pretreatment showed promising cost reductions, fungal pretreatment remained more expensive than conventional methods due to the significant capital investment required.