It is known that 2,3-butanediol is a potentially valuable chemical feedstock that can be produced from the sugars present in hemicellulose and celluose hydrolysates. Klebsiella oxytoca is able to ferment most pentoses, hexoses, and disaccharides. Butanediol appears to be a primary metabolite, excreted as a product of energy methabolism. The theoretical maximum yield of butanediol from monosaccharides is 0.50 g/g. This article describes the effects of pH, xylose concentration, and the oxygen transfer rate on the bioconversion of D-xylose to 2,3-butanediol. Product inhibition by butanediol is also examined. The most important variable affecting the kinetics of this system appears to be the oxygen transfer rate. A higher oxygen supply favors the formation of cell mass at the expense of butanediol. Decreasing the oxygen supply rate increases the butanediol yield, but decreases the overall conversion rate due to a lower cell concentration.