Ascomycete yeasts are metabolically diverse, with great potential for biotechnology. Here, we report the comparative genome analysis of 29 taxonomically and biotechnologically important yeasts, including 16 newly sequenced. We identify a genetic code change, CUG-Ala, in Pachysolen tannophilus in the clade sister to the known CUG-Ser clade. Our well-resolved yeast phylogeny shows that some traits, such as methylotrophy, are restricted to single clades, whereas others, such as l-rhamnose utilization, have patchy phylogenetic distributions. Gene clusters, with variable organization and distribution, encode many pathways of interest. Genomics can predict some biochemical traits precisely, but the genomic basis of others, such as xylose utilization, remains unresolved. Our data also provide insight into early evolution of ascomycetes. We document the loss of H3K9me2/3 heterochromatin, the origin of ascomycete mating-type switching, and panascomycete synteny at the MAT locus. These data and analyses will facilitate the engineering of efficient biosynthetic and degradative pathways and gateways for genomic manipulation.