The use of an underutilized and abundant lignocellulosic feedstock residue, wheat bran, was studied for ethanol production using dilute phosphoric acid pretreatment followed by fermentation using edible fungi Neurospora intermedia. Wheat bran was subjected to dilute acid pretreatment at varying acid concentrations (0.5–3.0% w/v), temperature (150–210 • C), and reaction time (5–20 min). The interaction of multiple factors showed the optimum pretreatment conditions at acid concentration of 1.75% (w/v), at 190 • C for 10 min. The maximum total polysaccharide yield of 0.27 ± 0.01 g/g dry biomass loading, corresponding to 66% of the theoretical maximum was observed. Subsequent fermentation with N. intermedia showed 85% of the theoretical maximum ethanol yield from the untreated bran glucose. The effect of the dilute acid pretreatment on the functional groups of the wheat bran cellulose was determined with 78% reduction in the cellulose crystallinity index. The validation of the dilute phosphoric acid pretreatment in a demo plant is also reported for the first time. Enzymatic hydrolysis of pretreated slurry from the demo plant showed 85% total theoretical yield of polysaccharides. Compared to the untreated bran biomass, an increase of 51% was observed in the ethanol yield following pretreatment, with a total ethanol yield of 95% theoretical maximum. Higher yield of ethanol is also attributed to the xylose fermenting capability of the fungi.