Fermentation takes place in the cell's cytoplasm. In prokaryotic cells, all metabolic processes take place in the cytoplasm; in eukaryotic cells, only fermentation takes place in the cytoplasm. Other forms of respiration in eukaryotes take place in the mitochondria.
In eukaryotic cells, fermentation generally occurs in the absence of oxygen. Yeasts, which utilize fermentation even in environments were oxygen is available, are the exception to this rule. Metabolic processes in the mitochondria require oxygen, which is why fermentation occurs in the cytoplasm.
In yeasts, fermentation produces ethanol. Animal cells and prokaryotes that utilize fermentation produce lactic acid. In animals, lactic acid fermentation is a fallback process used in muscle cells when oxygen is unavailable. This type of fermentation only occurs in the muscle cells of mammals.
Lactic acid-producing bacteria are used in the production of fermented foods. These include yogurt, sauerkraut, kimchi and some types of sour beer. Other beers and wines are produced with ethanol-producing yeast fermentation. Bread dough rises through yeast fermentation; the carbon dioxide produced as a waste product forms the bubbles that give the dough its structure. Industrially, fermentation is used to produce biofuels, in hydrogen production and to treat human waste in water treatment plants.