Abstract The potential of biomass energy in Sabah, Malaysia was analyzed by data which was established from literature, statistic data and available documents for estimating the potential of biomass energy derived from oil palm, coconut shell, rice, livestock and forest. Nowadays, the issue of solid biomass residues including effluent from the palm oil milling process has become a big concern for the industry and the public in Sabah, because oil palm residues provide a huge potential of biomass energy in Sabah. This paper showed that biomass energy potential in Sabah was around 267,179,818 GJ/year in total, which was derived from oil palm EFB, shell, OPF (oil palm frond), OPT (oil palm trunk), coconut shell, rice, livestock and forest. Potential of biomass energy from oil palm, coconut shell, rice, livestock and forest was 263,635,079 GJ/year, 95,713 GJ/year, 710,028 GJ/year, 750,696 GJ/year and 1,988,301 GJ/year, respectively. Most biomass energy came from oil palm, which was around 98.7% of total potential. If this total energy potential is applied at a power plant with efficiency ratio of 25% and 8000 h per year of operation, this has potential of 2,288 MW, which is equivalent to around 3.8 times of total supply of electricity in 2010 in Sabah. This paper also suggests that relevant policy and innovative technology be developed based on the result to effectively utilize biomass.