ABSTRACTOleaginous yeast are promising organisms for the production of lipid‐based chemicals and fuels from simple sugars. In this work, we explored Rhodosporidium toruloides for the production of lipid‐based products. This oleaginous yeast natively produces lipids at high titers and can grow on glucose and xylose. As a first step, we sequenced the genomes of two strains, IFO0880, and IFO0559, and generated draft assemblies and annotations. We then used this information to engineer two R. toruloides strains for increased lipid production by over‐expressing the native acetyl‐CoA carboxylase and diacylglycerol acyltransferase genes using Agrobacterium tumefaciens mediated transformation. Our best strain, derived from IFO0880, was able to produce 16.4 ± 1.1 g/L lipid from 70 g/L glucose and 9.5 ± 1.3 g/L lipid from 70 g/L xylose in shake‐flask experiments. This work represents one of the first examples of metabolic engineering in R. toruloides and establishes this yeast as a new platform for production of fatty‐acid derived products. Biotechnol. Bioeng. 2016;113: 1056–1066. © 2015 Wiley Periodicals, Inc.