Overexpression of D-xylulokinase in Saccharomyces cerevisiae engineered for assimilation of xylose results in growth inhibition that is more pronounced at higher xylose concentrations. Mutants deficient in the para-nitrophenyl phosphatase, PHO13, resist growth inhibition on xylose. We studied this inhibition under aerobic growth conditions in well-controlled bioreactors using engineered S. cerevisiae CEN.PK. Growth on glucose was not significantly affected in pho13 Delta mutants, but acetate production increased by 75%. Cell growth, ethanol production, and xylose consumption all increased markedly in pho13 Delta mutants. The specific growth rate and rate of specific xylose uptake were approximately 1.5 times higher in the deletion strain than in the parental strain when growing on glucose-xylose mixtures and up to 10-fold higher when growing on xylose alone. In addition to showing higher acetate levels, pho13 Delta mutants also produced less glycerol on xylose, suggesting that deletion of Pho13p could improve growth by altering redox levels when cells are grown on xylose.