Abstract Biomass, which its conversion into greener bio-based products, is able to achieve a more balanced carbon cycle through circular utilisation. The development of biomass industry, therefore, appears to be one priority area and is an important step to motivate the global circular economy and sustainability. However, due to the existence of commercialisation barriers, the biomass industry in developing country, such as Malaysia, is not on par with the increment of the country's gross domestic product. This paper overviews the barriers of development and challenges encountered by the biomass industry in Malaysia. Challenges are classified into four barrier categories, i.e., (i) technical barrier, (ii) financial barrier, (iii) social awareness barrier and (iv) misunderstanding and gaps between stakeholders. Based on the barriers identified, recommendations which embrace the areas of technology innovation, logistics management, interaction between academia and industry, policy and enforcement, social impact and international benchmarking, are proposed. These recommendations can act as good references for the development of biomass industry in Malaysia and reflection for other developing countries with biomass resources in the promotion of sustainability and commercialisation of biomass products. The role of the five key stakeholders in commercialising the biomass technologies are highlighted in this review.