A liquid fuel production process from Cellulosic biomass and coal comprises providing a mixture of Cellulosic biomass and coal, subjecting the mixture to gasification to obtain synthesis gas and converting the synthesis gas to a liquid fuel under the presence of catalyst. The catalyst includes molybdenum sulfide, alkali metal compound and a component activating the C—H bond in alkanes product, wherein the alkali metal compound is selected from the group of salts of Li, Na, K, Rb and Cs, the component activating the C—H bond in alkanes product is selected from Mo, V, Os, Re, Ir, Pt, Pd, Co, Rh, Ni and their mixture. Additionally, co-gasification of Cellulosic biomass and coal can reduce the ash fusion temperature of coal.