The objective of the present work has been to evaluate the impact of damage caused by defoliating insects on wood quality and charcoal production, and to quantify the losses per hectare according to the charcoal produced. Seven-year-old Eucalyptus grandis × Eucalyptus urophylla (clone A) and Eucalyptus saligna (clone B) trees, both in healthy condition and damaged by defoliating insects, were selected, with five trees to be used per treatment. Wood disks were removed from the trees at 0, 25, 50, 75 and 100% of the commercial height for analyzing the properties of the wood and for preparing and characterizing the charcoal. Damage by defoliating insects decreased the basic density of the trees at all axial positions by up to 23 kg m-3. Also, the extractives and lignin contents increased, while the holocellulose content decreased in the attacked plants. Changes in the wood characteristics led to increased fixed carbon content and gravimetric yield, and a decrease in density. The charcoal productivity from the plants damaged by defoliating insects was lower, mainly because of the decrease in volumetric production.