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Sugar beet pulp (SBP) is a major byproduct from the sugar industries and consists of >20% w/w arabinose. The current work evaluated the potential of Enterobacter ludwigii assimilating pure arabinose and arabinose rich hydrolysate from SBP pellets for 2,3-butanediol (BDO) production. The hydrolysate was obtained through dilute acid pretreatment (DAP) with sulphuric acid. The process was optimized for acid and solid loading to obtain a hydrolysate free from furan derivatives. The effect of different levels of substrate (10–60 g/L) using pure arabinose was conducted in shake flask experiments, followed by co-fermentation with small amounts of glucose and SBP hydrolysate. After flask cultivations, BDO fermentations were carried-out in a bench-top bioreactor in batch and fed-batch modes using pure arabinose as well as SBP hydrolysate. The fed-batch culture led to BDO production of 42.9 and 35.5 g/L from pure arabinose and SBP hydrolysate with conversion yields of 0.31 and 0.29 g/g, respectively. Finally, BDO accumulated on pure arabinose and SBP hydrolysate were recovered using an aqueous two-phase extraction system. The recovery yield of BDO accumulated on arabinose and hydrolysate was ∼97%. The work demonstrated the feasibility of using SBP as a suitable feedstock for manufacturing BDO.