In this article, I explore economic research that illustrates how inefficient markets can lead to environmental degradation and present my ideas regarding how entrepreneurial activity can exploit market inefficiencies to resolve environmental problems. As a global society, we are more aware of the negative effects of pollution, energy dependence, and climate change than ever before. Tied to each of these massive environmental challenges are opportunities for entrepreneurs to capitalize on innovative business solutions that benefit the environment, create jobs, and generate wealth. My work fuses past research in the fields of economics and business and identifies how entrepreneurship can play a major role in addressing the environmental challenges that we face today. In this article I concentrate on the concept of sustainable entrepreneurship – a concept that shows that profitability can be achieved by those that recognize market failures and adapt business models to seize opportunities that would otherwise go unrealized. I present examples from the energy and clean technology industries to build these ideas.