The mechanism of production of xylitol from xylose by Candida guilliermondii was studied using chemostat cultures and enzymatic assays. The maximum dilution rate in aerobic conditions was 0.34 1/h. No xylitol was produced. Under oxygen-limited conditions xylose uptake was impaired and glycerol accumulated but no xylitol was detected. Under transient oxygen limitation, caused by a gradual decrease in the agitation rate, onset of xylitol, acetate and residual xylose accumulation occurred simultaneously when qo2 dropped below 25 mmol/C-mmol cell dry weight (CDW) per hour. Ethanol and glycerol started to accumulate when qo2 dropped below 20 mmol/C-mmol CDW per hour. The highest in vitro enzyme activities were found at the lowest dilution rate studied (0.091/h) under aerobic conditions. The amount of active enzymes or cofactor availability did not limit the rate of xylose consumption. Our results confirm that a surplus of NADH during transient oxygen limitation inhibited the activity of xylitol dehydrogenase which resulted in xylitol accumulation. Phosphoglucoisomerase (E.C. 5.3.1.9.) and glucose-6-phosphate dehydrogenase (E.C. 1.1.1.49) activities suggest re-shuttling of the metabolites into the pentose phosphate pathway.