This paper provides a fundamental and critical review of biomass application as a reducing agent and fuel in integrated steelmaking. The basis for the review is derived from the current process and product quality requirements that also biomass-derived fuels should fulfill. The availability and characteristics of different sources of biomass are discussed and suitable pretreatment technologies for their upgrading are evaluated. The existing literature concerning biomass application in bio-coke making, blast furnace injection, iron ore sintering and production of carbon composite agglomerates is reviewed and research gaps filled by providing insights and recommendations to the unresolved challenges. Several possibilities to integrate the production of biomass-based reducing agents with existing industrial infrastructures to lower the cost and increase the total efficiency are given. A comparison of technical challenges and CO2 emission reduction potential between biomass-based steelmaking and other emerging technologies to produce low-CO2 steel is made.