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This study aims to answer the question if and how biofuels can be produced in Mexico without aggravating water scarcity, reducing greenhouse gas (GHG) emissions and avoiding indirect land‐use changes. We analyzed environmental impacts of six potential maize‐bioethanol production systems in Mexico on water resources, land use, and GHG emissions by using a life cycle assessment approach. Three irrigated high‐input maize systems and three rain‐fed low‐yield systems were analyzed. Inventory data was acquired by soil sampling and interviews with farmers. For the water footprint, field water balances were modeled using the Food and Agriculture Organization (FAO) AquaCrop Model. For the carbon footprint, the BioGrace tool was used. Based on the results of status‐quo analysis, scenarios with improved agricultural management were defined to identify optimization potential. Additionally, the …