Land use change for bioenergy feedstocks is likely to intensify as energy demand rises simultaneously with increased pressure to minimize greenhouse gas emissions. Initial assessments of the impact of adopting bioenergy crops as a significant energy source have largely focused on the potential for bioenergy agroecosystems to provide global-scale climate regulating ecosystem services via biogeochemical processes. Such as those processes associated with carbon uptake, conversion, and storage that have the potential to reduce global greenhouse gas emissions (GHG). However, the expansion of bioenergy crops can also lead to direct biophysical impacts on climate through water regulating services. Perturbations of processes influencing terrestrial energy fluxes can result in impacts on climate and water across a spectrum of spatial and temporal scales. Here, we review the current state of knowledge about biophysical feedbacks between vegetation, water, and climate that would be affected by bioenergy-related land use change. The physical mechanisms involved in biophysical feedbacks are detailed, and interactions at leaf, field, regional, and global spatial scales are described. Locally, impacts on climate of biophysical changes associated with land use change for bioenergy crops can meet or exceed the biogeochemical changes in climate associated with rising GHG’s, but these impacts have received far less attention. Realization of the importance of ecosystems in providing services that extend beyond biogeochemical GHG regulation and harvestable yields has led to significant debate regarding the viability of various feedstocks in many locations. The lack of data, and in some cases gaps in knowledge associated with biophysical and biochemical influences on land-atmosphere interactions, can lead to premature policy decisions.