Pretreatment of Douglas-fir by steam explosion produces a substrate containing approx 43% lignin. Two strategies were investigated for reducing the effect of this residual lignin on enzymatic hydrolysis of cellulose: mild alkali extraction and protein addition. Extraction with cold 1% NaOH reduced the lignin content by only approx 7%, but cellulose to glucose conversion was enhanced by about 30%. Before alkali extraction, addition of exogenous protein resulted in a significant improvement in cellulose hydrolysis, but this protein effect was substantially diminished after alkali treatment. Lignin appears to reduce cellulose hydrolysis by two distinct mechanisms: by forming a physical barrier that prevents enzyme access and by non-productively binding cellulolytic enzymes. Cold alkali appears to selectively remove a fraction of lignin from steam-exploded Douglas-fir with high affinity for protein. Corresponding data for mixed softwood pretreated by organosolv extraction indicates that the relative importance of the two mechanisms by which residual lignin affects hydrolysis is different according to the pre- and post-treatment method used.