A novel oat-based biorefinery producing L(+)-lactic acid and various value-added coproducts (e.g., β-glucan, anti-irritant solution) is proposed. Pearling is employed for sequential separation of bran-rich fractions for the extraction of value-added coproducts. Lactic acid production is achieved via fungal fermentation of Rhizopus oryzae on pearled oat flour. Maximum lactic acid concentration (51.7 g/L) and starch conversion yield (0.68 g/g) were achieved when an oat flour concentration of 116.5 g/L was used. Oxygen transfer played a significant role with respect to lactic acid production and starch conversion yield. Rhizopus oryzae produced a range of enzymes (glucoamylase, protease, phosphatase) for the hydrolysis of cereal flour macromolecules. Enzyme production during fungal fermentation has been reported. The proposed biorefining strategy could lead to significant operating cost reduction as compared to current industrial practices for lactic acid production from pure glucose achieved by bacterial fermentations.