Chinese liquor distillers’ grain (CLDG) is an abundant industrial organic waste showing high potential as feedstock for biofuel conversion. In this study, CLDG was used as substrate by microbial community in pit mud to produce medium-chain fatty acids (especially caproate). Simulated and real fermentation were used to evaluate the effect of ethanol and lactic acid being the electronic donors (EDs) during the anaerobic chain elongation (CE). The caproate concentration was achieved at 449 mg COD/g VS, with the corresponding high carbon selectivity at 37.1%. Microbial analysis revealed that the domestication of pit mud increased the abundance of Caproiciproducens (converting lactic acid into caproate) and Lactobacillus (producing lactic acid), leading to enhanced caproate production. The lactic acid conversion facilitated in full utilization of ethanol through CE consumption. The coexistence of EDs benefited the CE system and that this green energy production can be a promising high-performance biofuel donor for sustainable industrial production development.