Biodesulfurization of fuel oils is a two-phase (oil/water) process which may offer an interesting alternative to conventional hydrodesulfurization due to the mild operating conditions and reaction specificity afforded by the biocatalyst. For biodesulfurization to realize commercial success, a variety of process considerations must be addressed including reaction rate, emulsion formation and breakage, biocatalyst recovery, and both gas and liquid mass transport. This study evaluates emulsion formation and breakage using two biocatalysts with differing hydrophobic characteristics. A Grain-positive (Rhodococcus erythropolis) biocatalyst, expressing the complete 4S desulfurization pathway, and a Gram-negative biocatalyst (Escherichia coli), expressing only the gene for conversion of dibenzothiophene (DBT) to DBT sulfone, are compared relative to their ability to convert DBT and the ease of phase separation as well as biocatalyst recovery following desulfurization.