NOVELTY - Producing ethanol and methane comprising fermenting grain in an aqueous medium to produce ethanol in the medium, a residue, and carbon dioxide, is new.    USE - The method is used for producing ethanol and methane (claimed).    ADVANTAGE - The invented method integrates a concentrated animal feeding operations (CAFO) with ethanol production in such a manner that the economics of both the ethanol production and the feedlot or dairy operation are enhanced. It integrates anaerobic digestion of livestock waste with ethanol production in such a manner that the economics of both the ethanol production and the anaerobic digestion are enhanced. It provides a ruminant CAFO with a natural feed that is efficient in terms of weight gain, that can justify the reduction in use of anabolic steroids and antibiotics, and that reduces livestock flatulence. It provides a wet cake as a feed ration component for beef and/or dairy cattle such that conversion efficiencies and the animals' health are improved. It reduces the incidence of Escherichia coli in beef cattle by utilizing high saturation feed ration (ethanol unit wet cake) to reduce acidosis, typically caused by excessive starch in the feeding ration. It provides a high protein feed, in required quality and quantities, for ruminant animals by locating the ethanol unit adjacent to their confinement location, therefore eliminating long distance transport and the need for expensive drying. It improves the starch: protein balance of the traditional cattle ration, and enables the replacement of external protein sources such as urea and alfalfa hay, therefore reducing feeding costs and simplifying a cattle operation's sourcing and inventory requirements. It reduces/eliminates cattle feedlot odor and water contamination by rapid transfer of the cattle waste into the anaerobic digestion system, and destruction of the pathogens by the conversion of the cattle waste into biogas, bio-fertilizer, and bio-sludge. It makes the production of the ethanol and biogas bio-fuels more cost competitive with fossil fuels, by exploiting synergies to reduce capital and operating costs, and maximizing returns on all of the co-products. It eliminates the need for the capital intensive, and costly to operate and maintain, spent grain mash drying equipment in the ethanol plant, including thermal oxidizers now required by environmental authorities to reduce harmful emissions caused by the driers. It reduces the emissions of greenhouse gases, therefore reducing the threat of global warming. It reduces the use of fossil fuel fertilizers, and breaks the nitrogen/phosphate build-up cycle that is causing massive dead zones in the Gulf of Mexico and other waterways due to field runoff. It balances the sizes of the ethanol unit and the feedlot so that all of the high protein can be fed wet directly to the cattle, without capital- and energy intensive drying, and freight. It simplified ethanol plant's capital costs to be reduced by up to 30%. It reduces operation and maintenance requirements and overall labor costs.    DETAILED DESCRIPTION - Production of ethanol and methane comprises fermenting grain in an aqueous medium to produce ethanol in the medium, a residue, and carbon dioxide; separating the ethanol and residue; separating the residue into wet cake and thin stillage; feeding the wet cake to livestock, where the wet grain residue constituting 25-80% of a feed ration of the livestock on a dry weight basis; collecting manure produced by the livestock; admixing a portion of the collected manure and a portion of the thin stillage to produce an admixture; and digesting the admixture to produce bio-gas, liquid effluent and, as a residue, or bio-fertilizer.