Energy diversification and the use of renewable energy sources are key points in the European energy strategy. Biofuels are the most popular renewable resource option for the transport sector, and the European Union has established objectives that the Member States must adopt and implement. However, biofuel production at such a scale requires a considerable amount of water resources, and this water-energy nexus is rarely taken into account. This paper shows the strong nexus between water and energy in biofuel production and estimates the virtual water (VW) content and the water footprint (WF) from the raw material production that will be needed to reach the Spanish targets for biofuel consumption by 2010. The results show how the impact of such targets on the global and local water situation could be reduced through virtual water imports and, at the same time, how these imports could increase Spain's water and energy dependence. Hence, in order to manage water from an integral perspective of the territory, the inclusion of biofuel consumption objectives should go hand in hand with measures to reduce the demand of energy in the transport sector.