The degree of enzyme hydration is the one of the most important factors which can affect enzyme activity and stability in water-limited environments. Alcohol dehydrogenase from baker’s yeast (YADH) has been used as a model enzyme to study the effects of hydration on activity, stability, and cofactor stability with gas phase substrates. In all cases,the enzyme is essentially inactive until a temperature-independent degree of surface coverage by water molecules has been reached. The critical water content corresponds to 40-50% of a single monolayer. Careful control of the degree of hydration, by adjustments to gas humidity and temperature, enables the enzyme to be stabilized for periods exceeding 1 month, whereas in water the half-life of the enzyme is 30 min. The reaction with gas phase substrates follows a pseudo-first-order mechanism with an activation energy of 7.5 +/- kcal/mol, which is almost half of that in aqueous solution.