Numerous research efforts have the goal of commercializing biofuel production from terrestrial lignocellulosic biomass. Another potential source of biomass for biofuels are marine plants such as microalgae, which are composed primarily of galactose. While Saccharomyces cerevisiae can ferment galactose to ethanol, ethanol yields and productivities from galactose are significantly lower than those from glucose. In addition, when presented with a mixture of glucose and galactose, S. cerevisiae ferments glucose preferentially, only fermenting galactose once all glucose is consumed. This diauxic fermentation reduces overall ethanol productivities during fermentations of glucose and galactose mixtures. In this study, we demonstrate improved ethanol yields and productivities by co-fermentation of cellobiose and galactose by an engineered S. cerevisiae strain expressing genes coding for a cellodextrin transporter (cdt-1) and an intracellular β-glucosidase (gh1-1) from Neurospora crassa. This co-fermentation strategy holds advantages over the current strategy of sequential fermentation of glucose and galactose from the hydrolyzate of marine biomass. First, addition of β-glucosidase is not required as the engineered strain is capable of fermenting cellobiose; enzyme cost is lower. Second, the overall fermentation period can be reduced because the engineered strain co-consumes cellobiose and galactose simultaneously; volumetric productivity is increased. These benefits will contribute to economic biofuel production from marine biomass.