Saline land represents a growing resource that could be utilised for growing biomass crops, such as Miscanthus × giganteus (Greef et Deu.), for eliminating competition with staple food crops. However, the response mechanisms to different salinity regimes, in relation to the impact on quality of the harvested biomass and the combustion properties are largely unknown. Herein, the focus was on the salt-induced compositional changes of ion flux and compartmentalization in the rhizome, stems, and leaves in relation to their impact on salinity tolerance and the combustion quality through investigating the photophysiological, morphophysiological, and biochemical responses of M. × giganteus to moderate and a severe salinity. Severe salinity induced an immediate and sustained adverse response with a reduction in biomass yield, photoinhibition, and metabolic limitations in photosynthesis. Moderate salinity resulted in a slower cumulative response with low biomass losses. Biomass composition, variations in ion compartmentalisation and induction of proline were dependent on the severity and duration of salinity. Ash behaviour indices, including the base percentage and base-to-acid ratio, indicated lower corrosion potential and lower risk of slagging under salinity. Understanding the impact of salinity on the potential for growth on saline land may identify new targets for breeding salinity-tolerant bioenergy crops.