Mutants of xylose-assimilating recombinant Saccharomyces cerevisiae carrying the xylose reductase and xylitol dehydrogenase genes on plasmid pEXGD8 were selected, after ethyl methanesulfonate treatment, for their rapid growth on xylose medium. The fastest growing strain (strain IM2) showed a lower activity of xylose reductase but a higher ratio of xylitol dehydrogenase to xylose reductase activities than the parent strain, as well as high xylulokinase activity. Southern hybridization of the chromosomal DNA indicated that plasmid pEXGD8 was integrated into the chromosome nf mutant IM3 resulting in an increase in the stability of the cloned genes. In batch fermentation under O-2 limitation, the yield and production rate of ethanol were improved 1.6 and 2.7 times, respectively, compared to the parent strain. In fed-batch culture with slow feeding of xylose and appropriate O-2 supply at a low level, xylitol excreted from the cells was limited and the ethanol yield increased 1.5 times over that in the batch culture, with a high initial concentration of xylose, although the production rate was reduced. The results suggested that slow conversion of xylose to xylitol led to a lower level of intracellular xylitoi, resulting in less excretion of xylitol, and an increase in the ethanol yield. It was also observed that the oxidation of xylitol was strongly affected by the O-2 supply.