A process for catalytically converting crude tall oil into hydrocarbons suitable as biofuel components. The crude tall oil is treated in a reactor system including a catalytically active guard bed phase and a catalytically active main reaction phase. At least one of the phases includes a catalyst bed with a combination of hydrodeoxygenating (HDO) and hydrodewaxing (HDW) catalysts. The process provides biofuel with acceptable ignition and cold flow properties.