NAD(P)H-dependent oxidoreductases are valuable tools for synthesis of chiral compounds. The expensive cost of the cofactors, however, requires in situ cofactor regeneration for preparative applications. We have attempted to develop an enzymatic system based on phosphite dehydrogenase (PTDH) from Pseudomonas stutzeri to regenerate the reduced nicotinamide cofactors NADH and NADPH. We used directed evolution to address one of the main limitations with the wild-type PTDH enzyme, its low stability. After three rounds of random mutagenesis and high throughput screening, twelve thermostable amino acid substitutions were identified. These twelve mutations were combined by site-directed mutagenesis, resulting in a mutant whose T₅₀ is 20°C higher and half-life of thermal inactivation at 45°C is >7000-fold greater than that of the parent PTDH. The engineered PTDH has a half-life at 50°C that is 2.4-fold greater than the Candida boidinii formate dehydrogenase (FDH), an enzyme widely used for NADH regeneration.  The improved stability and effectiveness of the thermostable PTDH mutant was shown using the industrially important bioconversion of trimethylpyruvate to L-tert-leucine. Site-directed mutagenesis was also used to incorporate a cofactor specificity mutation (A176R) identified in previous work into the thermostable PTDH construct to create a powerful new NADPH regenerating enzyme.  Several regeneration reactions were selected and conducted in small-scale batch reactions and in an enzyme membrane reactor to evaluate the capabilities of the PTDH mutants.  The engineered PTDH will be useful in NAD(P)H regeneration for industrial biocatalysis.