Escherichia coli cells co-expressing genes coding for Candida tenuis xylose reductase and Candida boidinii formate dehydrogenase were used for the bioreduction of o-chloroacetophenone with in situ coenzyme recycling. The product, (S)-1-(2-chlorophenyl)ethanol, is a key chiral intermediate in the synthesis of polo-like kinase 1 inhibitors, a new class of chemotherapeutic drugs. Production of the alcohol in multi-gram scale requires intensification and scale-up of the biocatalyst production, biotransformation, and downstream processing. Cell cultivation in a 6.9-L bioreactor led to a more than tenfold increase in cell concentration compared to shaken flask cultivation. The resultant cells were used in conversions of 300 mM substrate to (S)-1-(2-chlorophenyl)ethanol (e.e. >99.9%) in high yield (96%). Results obtained in a reaction volume of 500 mL were identical to biotransformations carried out in 1 mL (analytical) and 15 mL (preparative) scale. Optimization of product isolation based on hexane extraction yielded 86% isolated product. Biotransformation and extraction were accomplished in a stirred tank reactor equipped with pH and temperature control. The developed process lowered production costs by 80% and enabled (S)-1-(2-chlorophenyl)ethanol production within previously defined economic boundaries. A simple and efficient way to synthesize (S)-1-(2-chlorophenyl)ethanol in an isolated amount of 20 g product per reaction batch was demonstrated. Biotechnol. Bioeng. 2013; 110: 2311–2315. © 2013 Wiley Periodicals, Inc.