You may be wondering what Koalas and Lyocell fabrics have in common? - Wonder no more! Here we bring curious facts about lyocell, some practical tips, and as always, sustainable alternatives for your wardrobe.

Mirror, mirror, on the wall. Which fabric is the softest of them all?

Life is filled with simple pleasures that bring us immeasurable joy, and wearing soft clothes is definitely one of them. But soft clothes that are also sustainable? Now that is a dreamy combination.

Dubbed as the “wonder fabric”, lyocell checks all our boxes... Or does it? Let’s read and find out!

What Is Lyocell?

Made from cellulose fibers from Eucalyptus trees, Lyocell is a 3rd-generation rayon and often finds its use as an alternative to silk or cotton. Much like the other types of rayon (viscose and modal), lyocell is a semi-synthetic fabric because the natural raw material needs to undergo a chemical process in order to be converted into fibers. However, lyocell is much more sustainable because it uses a closed-loop manufacturing process using an organic solvent.

Known for its comfort and heavenly softness, lyocell is usually used to make dresses, shirts, underwear, towels, bedsheets, and ethical denim. Since lyocell is very strong, apart from the fashion industry, it is also used commercially - to make things such as wipes, medical swabs and gauzes, conveyor belts, and special paper. No wonder Selfridges called it a miracle fabric!

How is Lyocell Made? (Image Source: Lenzing)

How Is Lyocell Made?

The making of lyocell is very similar to that of modal and viscose, with a few differences. Cellulose is extracted from harvested beechwood trees (most commonly eucalyptus). It is, then, dissolved and filtered before undergoing the process of spinning, a method by which the dissolved cellulose is forced through spinnerets to turn it into long and thin fibers.

The fibers are then dissolved in a diluted amine oxide solution and left to dry. Then they are coated with a lubricant such as soap or silicone. The strands are then separated and cut, and voila! The lyocell fiber is ready!

The difference between the making of lyocell and other types of cellulosic fibers is that lyocell uses a solvent spinning process in which 99.5% of the non-toxic organic compound amine oxide is recovered and re-used, leaving no harmful by-products. Unlike viscose, toxic Carbon Disulfide is not involved in Lyocell making and the amount of water use is minimal, leading to lesser environmental stress.

But how did this fabric come into existence?

The History of Lyocell

Lyocell was first born in 1972 at a fibers company in North Carolina called American Enka. After some failed attempts to commercialize this process, the production was transferred to the UK, where Courtaulds Fibers began producing it under the name “Tencel.”

Tencel changed hands a few times and was eventually acquired by Lenzing AG, an international textile group based in Austria. Today, Lenzing is the largest producer of Lyocell in the world.

Lyocell Advantages and Disadvantages


  • Lyocell is buttery smooth and is often used as an alternative to silk and cotton because of its feel. This is because it is made from very small fibers known as nanofibrils.
  • Durable and strong whether it is wet or dry. It also has good elasticity, so your clothes will last for a long long time.
  • Doesn’t wrinkle easily and drapes well, so you can look stylish without having to iron your clothes.
  • Breathable and feels very gentle and cool on your skin.
  • Hypoallergenic and doesn’t chafe, so it’s a great choice for people with sensitive skin.
  • Very absorbent. It has a 50% more absorption rate than cotton, so it is perfect for keeping you dry during summers.
  • Antibacterial. Lyocell has great moisture management capacity, so it does not retain any odor or bacteria, making it great for outdoor activities. It also stays fresh for longer.
  • Excellent thermal regulation, making it good for any weather (hot or cold). It encourages evaporation, meaning that it pulls moisture away from you.


  • Expensive.
  • Reasonably low surface energy. This means that it doesn't absorb dyes very well, and can be prone to pilling.
  • Delicate, so it requires extra care like hand-washing.
  • The manufacturing process uses a lot of energy.
  • No guarantee that the wood was sourced sustainably.
Modal Deforestation

Is Lyocell Sustainable?

Much like the other types of cellulosic fibers, lyocell can be sustainable if sourced responsibly. Eucalyptus trees are fast-growing trees that do not require irrigation or pesticides. They are most often grown on land that is unfit for agricultural use.

Lyocell is manufactured in a closed-loop process where no toxic chemicals are used. The amine oxide that is used in the process is almost completely reused. The 0.5% of chemicals that are released are deemed to be non-hazardous. The process also uses very little water. It is, however, energy-intensive which lowers its points on the sustainability meter. But, when comparing it with other cellulosic fibers like rayon and modal, lyocell emerges as the clear winner.

So, the sustainability of lyocell all boils down to how the raw material is sourced. There is no guarantee that the wood for generic lyocell was sourced from sustainable forests. There is a high chance that the production is contributing to deforestation and the subsequent loss of livelihood and biodiversity. Some generic lyocell is manufactured using genetically modified eucalyptus trees.

You can use our sustainability calculator to know the impact of each fiber on the environment.

So, what is the alternative?

Eco-friendly Alternatives

TENCEL™ Lyocell

Tencel™ Lyocell is a trademark of lyocell by the Austrian company Lenzing AG. The manufacturing process for Tencel™ lyocell and generic lyocell is almost identical. But with Tencel™, you get the guarantee that the fibers are sustainable.

Lenzing AG sources the raw materials from forests that are PEFC and FSC certified. The eucalyptus trees are NOT genetically modified. Moreover, the fibers are manufactured using the Best Available Technology (BAT).

TENCEL™ lyocell fibers are certified carbon neutral by Natural Capital Partners. They are certified biodegradable and compostable under industrial, marine, soil, freshwater, and home solutions by TUV Austria Belgium NV, so they return fully back to nature. They also have the EU Ecolabel certification which is awarded to products that have a low environmental impact.

TENCEL™ vs Lyocell

-34% CO₂ Emissions
-39% Water Scarcity
-19% Energy
-34% Eutrophication
-12% Chemistry
Closed Chemical Loop
Forest Conservation
Low MSI Score

Excel by Birla

Textile giant Birla is manufacturing lyocell under the name Excel. They use a carbon-neutral closed-loop process and recycle up to 99.7% of the solvents used in the manufacturing process. Their raw material is sourced sustainably from FSC and PEFC certified forests. Due to their sustainable practices, they were ranked as the #1 global viscose producer for three years in a row by Canopy’s Hot Button Report.

Comparison With Other Fabrics

Lyocell vs Cotton

Cotton plant for textile fibers

Lyocell is considered an alternative to cotton because of its softer feel and thermal regulation properties. Despite having a high absorption rate, lyocell also has the ability to wick away moisture. As a result, it keeps you cooler, drier, and fresher than cotton. So if you tend to sweat a lot, or live in an area with a hot climate, pick lyocell. Because of these properties, lyocell also makes a better option for activewear.

Lyocell is also better than cotton at keeping you warm. As long as you are not experiencing extreme temperatures, lyocell holds its own in both warm and cool climates.

When it comes to bedsheets, if you want your bed to feel like a dream, go for lyocell sheets. However, keep in mind that they need special care and are more expensive than cotton. But they don’t wrinkle, so that’s a plus! If you want a low-maintenance fabric and don’t mind wrinkles, go for cotton. Some people also like the crisp feel that cotton sheets provide.

Both cotton and lyocell are popular choices for undergarments. But lyocell wins again in this regard. It is softer, breathable, and anti-bacterial. So you can wear it all day long without feeling uncomfortable. It’ll feel like a gentle hug. Cotton, on the other hand, will lose its shape after a while and also traps perspiration.

Lyocell vs Viscose

Wood chips for rayon production

Both lyocell and viscose belong to the rayon family, but there are significant differences between them. For starters, the production of lyocell is closed-loop and has a very low environmental impact when compared to viscose. So lyocell comes out on top when it comes to sustainability.

When we talk about the properties, lyocell has a higher absorption rate, drapes better, and doesn’t wrinkle. Both of these fabrics require some level of maintenance. Viscose has a delicate texture but is not as soft as lyocell.

Pick lyocell:

  • To stay cool in warmer climates
  • When you need extra softness in your life
  • If easier maintenance is important to you

Pick viscose:

  • When you’re on a budget

Lyocell vs Polyester

PET water bottles - polyester

The stark difference between these two fabrics is that lyocell is semi-synthetic (and a lot more sustainable), while polyester is completely synthetic. Both of them are used to make activewear and other clothes in general. Both fabrics are strong, durable, moisture-wicking, and don’t wrinkle or shrink. But polyester is not breathable and doesn’t absorb sweat. So lyocell is a better choice for everyday garments in summer.

When it comes to choosing clothes for heavy workouts, or extreme weather conditions, polyester is a better choice because it is better at insulation, durable, and won’t have you covered in sweat. Don’t forget to shop for recycled polyester! On the other hand, lyocell might be a better choice for lighter workouts, such as yoga.

Lyocell vs Silk

Silk cocoons for fibers

Both lyocell and silk feel divine against our skin and are considered luxury fabrics. But lyocell is often touted as a more eco-friendly version of silk. Both lyocell and silk fibers are strong and durable, but silk has the tendency to deteriorate over time and can snag or tear easily.

Silk tends to trap heat, causing your body to overheat and sweat a lot. Lyocell, on the other hand, is very breathable. So lyocell is better for summers, while silk may be better for winters. Lyocell is also hypoallergenic, and is great for pillowcases!

Finally, lyocell is more sustainable than natural silk. Silk is NOT a vegan product, so always try to look for peace silk.