Efficient conversion of xylose to ethanol is an essential factor for commercialization of lignocellulosic ethanol. To minimize production of xylitol, a major by-product in xylose metabolism and concomitantly improve ethanol production, Saccharomyces cerevisiae D452-2 was engineered to overexpress NADH-preferable xylose reductase mutant (XR(MUT)) and NAD⁺-dependent xylitol dehydrogenase (XDH) from Pichia stipitis and endogenous xylulokinase (XK). In vitro enzyme assay confirmed the functional expression of XR(MUT), XDH and XK in recombinant S. cerevisiae strains. The change of wild type XR to XR(MUT) along with XK overexpression led to reduction of xylitol accumulation in microaerobic culture. More modulation of the xylose metabolism including overexpression of XR(MUT) and transaldolase, and disruption of the chromosomal ALD6 gene encoding aldehyde dehydrogenase (SX6(MUT)) improved the performance of ethanol production from xylose remarkably. Finally, oxygen-limited fermentation of S. cerevisiae SX6(MUT) resulted in 0.64 g l⁻¹ h⁻¹ xylose consumption rate, 0.25 g l⁻¹ h⁻¹ ethanol productivity and 39% ethanol yield based on the xylose consumed, which were 1.8, 4.2 and 2.2 times higher than the corresponding values of recombinant S. cerevisiae expressing XR(MUT), XDH and XK only.