Dilute sulfuric acid pretreated corn stover is potential feedstock of industrial interest for second generation fuel ethanol production. However, the toxicity of corn stover hydrolysate (PCS) has been a challenge for fermentation by recombinant xylose fermenting organisms. In this work, the thermophilic anaerobic bacterial strain Thermoanaerobacter BG1L1 was assessed for its ability to ferment undetoxified PCS hydrolysate in a continuous immobilized reactor system at 70°C. The tested strain showed significant resistance to PCS, and substrate concentrations up to 15% total solids (TS) were fermented yielding ethanol of 0.39–0.42 g/g-sugars consumed. Xylose was nearly completely utilized (89–98%) for PCS up to 10% TS, whereas at 15% TS, xylose conversion was lowered to 67%. The reactor was operated continuously for 135 days, and no contamination was seen without the use of any agent for preventing bacterial infections. This study demonstrated that the use of immobilized thermophilic anaerobic bacteria for continuous ethanol fermentation could be promising in a commercial ethanol process in terms of system stability to process hardiness and reactor contamination. The tested microorganism has considerable potential to be a novel candidate for lignocellulose bioconversion into ethanol.