Wood represents the most abundant form of biomass on earth with enormous economic potential, notably for pulp and biofuel production. Eucalyptus, the most widely planted hardwood genus worldwide, is has been identified as a potential bioenergy crop due to its fast growth, wide adaptability and cellulose-rich biomass. With the objective of improving Eucalyptus wood quality to facilitate industrial processing, we are working towards elucidating the regulation of wood formation. Our efforts are focused on the identification and functional characterization of key regulatory genes controlling wood formation, mainly transcription factors. Taking advantage of the recent release of the E. grandis genome by the DOE-JGI (http://www.phytozome.net/eucalyptus), we have performed a genome-wide survey of several important gene families including MYB, NAC, Aux/IAA, ARF and lignin biosynthetic genes. We first identified all members of these gene families and performed phylogenetic comparisons with Arabidopsis, rice, poplar and grapevine. Remarkably, we identified gene family clades specific to woody plants and/or greatly expanded in Eucalyptus. Expression profiling allowed us to identify genes exhibiting preferential or specific expression in xylem. We investigated also their expression in response to hormonal treatments and environmental stresses as well as in wood samples with contrasting properties. This allowed us to select promising new transcription factors potentially involved in wood formation. Their functional characterization in planta is currently undergoing and should help identify major factors underpinning the physicochemical properties of wood cell walls, the recalcitrance of which remains a key scientific and technical challenge limiting the efficient and sustainable production of second-generation biofuels.