Biofuels are expected to play a pivotal role in developing economies' transition towards net-zero emissions. However, their promotion can cause multifaceted sustainability concerns. National biofuel policies often align with the optimistic discourse surrounding biofuels but may lack comprehensive measures to simultaneously address all sustainability risks. This study conducts a systematic review to evaluate the sustainability performance of biofuels and examines their implications for advancing the Sustainable Development Goals (SDGs). A total of 12 sustainability indicators were identified as economic, social, and environmental priorities. Biofuel linkages with 8 SDGs, 21 targets, and 22 indicators were mapped. The analysis revealed a wider coverage of sustainability impacts associated with biodiesel compared to ethanol feedstocks for India. Notably, the sustainability effects of biofuels exhibited considerable variability across different spatial scales. Irrespective of the biofuel types, negative sustainability outcomes were found to be associated with socio-economic indicators related to food security, livelihood, and income, and environmental indicators like land use. Positive sustainability effects were observed for environmental indicators like water and soil quality, biodiversity, and ecosystem services. The study identifies policy gaps in addressing localized adverse effects of biofuels, emphasizing the need to align biofuel strategies with SDGs for more comprehensive and sustainable biofuel development in developing countries.