AbstractJatropha curcas is a multipurpose, drought‐resistant, biofuel tree originating from Central and South America, but now growing pantropic. The tree produces seeds containing 27–40% inedible oil, which is easily convertible into biodiesel. Although even some basic agronomic characteristics of J. curcas are not yet fully under‐s‐tood, the plant enjoys a booming interest, which may hold the risk of unsustainable practice. Our qualitative sustainability assessment, focusing on environmental impacts and strengthened by some socio‐economic issues, is quite favorable as long as only wastelands or degraded grounds are taken into J. curcas cultivation. Preliminary lifecycle energy and greenhouse gas (GHG) balances are positive, but the GHG balance is expected to be much dependent on the type of land use which is converted to J. curcas. Removing natural forest will have a severe impact on the global warming potential of the jatropha biodiesel. The cultivation intensity and the distance to markets are expected to have a significant impact on the GHG balance as well. Similar reasoning applies for the impact on soil, water, vegetation structure and biodiversity, although the latter will always depend on local circumstances. Next to biodiesel production and wasteland reclamation, J. curcas also hosts socio‐economic development potential. The multipurpose character of the plant and the labor‐intensive production chain are thought to be the main drivers for rural development, but are uncertain. In order to achieve best results with respect to both environmental and socio‐economic issues, decisions have to be based on local environmental, economical, cultural and social characteristics. © 2007 Society of Chemical Industry and John Wiley & Sons, Ltd