Cofactor regeneration is an important solution to the problem of implementing complex cofactor requiring enzymatic reactions at the industrial scale. NAD(P)H-dependent oxidoreductases are highly valuable biocatalysts, but the high cost of the nicotinamide cofactors necessitates in situ cofactor regeneration for preparative applications. Here we report the use of directed evolution to enhance the industrially important properties of phosphite dehydrogenase for NAD(P)H regeneration. A two-tiered sorting method of selection and screening was used in conjunction with random and rational mutagenesis. Following six rounds of directed evolution, soluble expression in E. coli was increased more than 3-fold, while the turnover rate was increased about 2-fold, effectively lowering the cost of the enzyme by >6-fold. Large-scale production of the final mutant enzyme by fermentation resulted in approximately 6-times higher yield (Units/Liter) than the WT enzyme. The enhancements of PTDH were independent of expression vector and E. coli strain utilized. The advantage of the final mutant over the WT enzyme was demonstrated using the industrially relevant bioconversion of trimethylpyruvate to L-tert-leucine. The mutations discovered are discussed in the context of a three dimensional structural model and the resulting changes in kinetics and soluble expression. The engineered phosphite dehydrogenase has great potential for NAD(P)H regeneration in industrial biocatalysis.