Ethanol toxicity and its effect on ethanol production by the recombinant ethanologenic Escherichia coli strain KO11 were investigated in batch and continuous fermentation. During batch growth, ethanol produced by KO11 reduced both the specific cell growth rate (mu) and the cell yield (Y-X/S). The extent of inhibition increased with the production of both acetate and lactate. Subsequent accumulation of these metabolites and ethanol resulted in cessation of cell growth, redirection of metabolism to reduce ethanol production, and increased requirements for cell maintenance. These effects were found to depend on both the glycolytic flux and the flux from pyruvate to ethanol. Pyruvate decarboxylase (Pdc) and alcohol dehydrogenase (Adh) activities measured during the batch fermentation suggested that decreased ethanol production resulted from enzyme inhibition rather than down-regulation of genes in the ethanol-producing pathway. Ethanol was added in continuous fermentation to provide an ethanol concentration of either 17 or 27 g/L, triggering sustained oscillations in the cell growth rate. Cell concentrations oscillated in-phase with ethanol and acetate concentrations. The amplitude of oscillations depended on the concentration of ethanol in the fermentor. Through multiple oscillatory cycles, the yield (Y-P/S) and concentration of ethanol decreased, while production of acetate increased. These results suggest that KO11 favorably adapted to improve growth by synthesizing more ATP though acetate production, and recycling NADH by producing more lactate and less ethanol. Implications of these results for strategies to improve ethanol production are described. Biotechnol. Bioeng. 2010;106: 721-730. (C) 2010 Wiley Periodicals, Inc.