A variety of biofuel and biorefinery products have been produced from engineered Escherichia coil till date. Most of these products had been derived from simple sugars in its pure form, rather than deriving it from alternative, renewable and carbon neutral sources, such as marine alga biomass. Engineering E. coli to use algal hydrolysate can make these an attractive carbon source for the industrial production of value added fuels and chemicals. This work reports the engineering of E. coil by a combination of gene deletion and synthetic pathway incorporation, for the efficient utilization of algal hydrolysate to produce BA (2,3 butanediol + acetoin) under microaerobic condition. Engineered strain produced similar to 19 g/L of total BA from algal hydrolysate in defined M9 salt media at a yield of 0.43 g/g. (C) 2013 Elsevier Ltd. All rights reserved.