It has been confirmed that Saccharomyces sp. W0 can produce high concentration of ethanol. In this study, the INU1 gene cloned from the marine-derived Pichia guilliermondii was transformed into uracil mutant of Saccharomyces sp. W0. The positive transformant Inu-66 obtained could produce 34.2 U ml−1 of extracellular inulinase within 72 h of cultivation. It was found that 15.2 U of inulinase activity per one gram of inulin was suitable for inulin hydrolysis and ethanol production by the transformant Inu-66. During the small-scale fermentation, 13.7 ml of ethanol in 100 ml of medium was produced and 99.1% of the added inulin was utilized by the transformant. During the 2 l fermentation, 14.9% (v/v) of ethanol was produced from inulin and 99.5% of the added inulin was converted into ethanol, CO2 and cell mass.