Targeted engineering of microbial genomes holds much promise for diverse biotechnological applications. Transcription activator-like effector nucleases (TALENs) and clustered regularly interspaced short palindromic repeats/Cas9 systems are capable of efficiently editing microbial genomes, including that of Saccharomyces cerevisiae. Here, we demonstrate the use of TALENs to edit the genome of S. cerevisiae with the aim of inducing the overproduction of fatty acids. Heterodimeric TALENs were designed to simultaneously edit the FAA1 and FAA4 genes encoding acyl-CoA synthetases in S. cerevisiae. Functional yeast double knockouts generated using these TALENs over-produce large amounts of free fatty acids into the cell. This study demonstrates the use of TALENs for targeted engineering of yeast and demonstrates that this technology can be used to stimulate the enhanced production of free fatty acids, which are potential substrates for biofuel production. This proof-of-principle study extends the utility of TALENs as excellent genome editing tools and highlights their potential use for metabolic engineering of yeast and other organisms, such as microalgae and plants, for biofuel production. (C) 2015, The Society for Biotechnology, Japan. All rights reserved.