We demonstrated that formaldehyde can be efficiently coutilized by an engineered Saccharomyces cerevisiae strain that expresses Hansenula polymorpha genes encoding formaldehyde dehydrogenase (FLD1) and formate dehydrogenase (FMD), in contrast to wild-type strains. Initial chemostat experiments showed that the engineered strain coutilized formaldehyde with glucose, but these mixed-substrate cultures failed to reach steadystate conditions and did not exhibit an increased biomass yield on glucose. Subsequent transcriptome analyses of chemostat cultures of the engineered strain, grown on glucose-formaldehyde mixtures, indicated that the presence of formaldehyde in the feed caused biotin limitations. Further transcriptome analysis demonstrated that this biotin inactivation was prevented by using separate formaldehyde and vitamin feeds. Using this approach, steady-state glucose-limited chemostat cultures were obtained that coutilized glucose and formaldehyde. Coutilization of formaldehyde under these conditions resulted in an enhanced biomass yield of the glucose-limited cultures. The biomass yield was quantitatively consistent with the use of formaldehyde as an auxiliary substrate that generates NADH and subsequently, via oxidative phosphorylation, ATP. On an electron pair basis, the biomass yield increase observed with formaldehyde was larger than that observed previously for formate, which is tentatively explained by different modes of formate and formaldehyde transport in S. cerevisiae.In industrial biotechnology, the carbon feedstock is usually a sugar or sugar-rich substrate such as molasses, which often represents an important cost factor. In many processes, a large portion of the sugar feed is not converted into product but is instead dissimilated to provide free energy (e.g., in the form of ATP equivalents or proton motive force) and/or reducing power [in the form of NAD(P)H]. The use of mixed substrates consisting of a sugar and an additional, inexpensive source of reducing power and/or free energy represents an interesting approach to reduce the costs of industrial fermentation. Ideally, this practice should lead to a situation in which the sugar is used exclusively as a carbon source for biomass and/or product formation. The validity of this "auxiliary substrate" concept has been demonstrated in many academic studies using compounds such as formate or thiosulfate, whose oxidation can provide free energy but which cannot be used as carbon sources (2,7,26).Methanol is a low-cost chemical which can be derived from fossil sources or from biomass (via syngas, a CO-and H 2 -containing gas mixture generated by gasification of organic matter) (9, 17) and is an interesting candidate for the role of "auxiliary substrate" in industrial biotechnology. However, only a few industrial microorganisms are capable of utilizing methanol, including several yeast species that can grow on methanol as the sole carbon and energy source (35,42,46). In these methylotrophic yeasts, like Hansenula polymorpha and Pichia pastoris, meth...