Arbutin, a glucoside of hydroquinone, is used as a powerful skin lightening agent in the cosmeceutical industry because of its strong inhibitory effect on the human tyrosinase activity. It is a natural compound occurring in a number of plants, with a beta-anomeric form of the glycoside bond between glucose and hydroquinone. alpha-Arbutin, which glycoside bond is generated with alpha-anomeric form, is the isomer of natural arbutin. alpha-Arbutin is generally produced by transglucosylation of hydroquinone by microbial glycosyltransferases. It is interesting that alpha-arbutin is found to be over 10 times more effective than arbutin, and thus biological production of alpha-arbutin attracts increasing attention. Seven different microbial enzymes have been identified to be able to produce alpha-arbutin, including alpha-amylase, sucrose phosphorlase, cyclodextrin glycosyltransferase, alpha-glucosidase, dextransucrase, amylosucrase, and sucrose isomerase. In this work, enzymatic and microbial production of alpha-arbutin is reviewed in detail.