Monoterpenes are liquid hydrocarbons with applications ranging from flavor and fragrance to replacement jet fuel. Their toxicity, however, presents a major challenge for microbial synthesis. Here we evolved limonene-tolerant Saccharomyces cerevisiae strains and sequenced six strains across the 200-generation evolutionary time course. Mutations were found in the tricalbin proteins Tcb2p and Tcb3p. Genomic reconstruction in the parent strain showed that truncation of a single protein (tTcb3p1-989), but not its complete deletion, was sufficient to recover the evolved phenotype improving limonene fitness 9-fold. tTcb3p1-989 increased tolerance toward two other monoterpenes (β-pinene and myrcene) 11- and 8-fold, respectively, and tolerance toward the biojet fuel blend AMJ-700t (10% cymene, 50% limonene, 40% farnesene) 4-fold. tTcb3p1-989 is the first example of successful engineering of phase tolerance and creates opportunities for production of the highly toxic C10 alkenes in yeast.