Metabolic engineering can have a pivotal role in increasing the environmental sustainability of the transportation and chemical manufacturing sectors. The field has already developed engineered microorganisms that are currently being used in industrial-scale processes. However, it is often challenging to achieve the titres, yields and productivities required for commercial viability. The efficiency of microbial chemical production is usually dependent on the physiological traits of the host organism, which may either impose limitations on engineered biosynthetic pathways or, conversely, boost their performance. In this Review, we discuss different aspects of microbial physiology that often create obstacles for metabolic engineering, and present solutions to overcome them. We also describe various instances in which natural or engineered physiological traits in host organisms have been harnessed to benefit engineered metabolic pathways for chemical production.