This study investigates the environmental performance of 2‐ethylhexanol (2‐EH), as a potential drop‐in transport fuel alternative. Three different biomass‐based production pathways are evaluated and compared using life cycle assessment (LCA) methodology. The environmental impact of 2‐EH is assessed in terms of cumulative energy demand (CED) and global warming potential (GWP). Among the three alternative pathways, 2‐EH produced via syngas results in the lowest primary energy demand and GHG emissions under the baseline assumptions of this work. The two biochemical production pathways (via ethanol and butanol) exhibit higher CED and GWP during biomass conversion steps mainly due to process materials and chemicals used. Process specifications such as transport distance to production facility or the fate of the obtained by‐products are shown to influence the overall environmental impact of the fuel for all studied pathways. The use phase performance of 2‐EH was also considered in this work, as part of a 100% renewable blend and was compared to existing fossil and renewable fuels. The studied blend has the potential to reduce GHG emissions by more than 85% compared to fossil diesel while when certain production pathways are followed, it exhibits lower GWP than renewable fuels already in the market such as ethanol blends and biodiesel. 2‐EH can therefore provide a competitive alternative to fossil transport fuels increasing the share of renewable content in the current vehicle fleet, thus enhancing the efforts for a sustainable transport sector.