Methanol is an attractive low-cost substrate for biotechnology. Although methanol-based cell factories have been established, there are still major gaps in understanding methylotrophy itself. Thus, limiting their use at industrial scale. In methylotrophic yeasts like Komagataella phaffii, the entire methanol utilization (MUT) pathway is confined in peroxisomes, which is essential for its functioning. In FUNCEMM, we aim to elucidate the meaning and importance of such spatial organization to apply it in the establishment of synthetic methylotrophy. We will first re-target the entire MUT pathway to the cytoplasm of K. phaffii to understand which MUT pathway reactions depend on peroxisomal localization. Second, artificial organelles based on bacterial microcompartments will be built to investigate whether the type of compartment is necessary for methylotrophy. Finally, we will harness this knowledge to build an artificial organelle mimicking the natural methylotrophic peroxisome to design superior synthetic methylotrophic Escherichia coli, capable of efficient use of methanol. Functionality of the MUT pathway variants will be assessed in vitro using in cell NMR analysis together with kinetic models while the engineered strains will be studied at the system level by combining multi-omics approaches with stoichiometric models. In one word, FUNCEMM proposes to apply the System & Synthetic Biology approaches to methylotrophy for industrial biotechnology. FUNCEMM brings together leading European expertise in natural & synthetic methylotrophy and biotechnology and will generate fundamental knowledge for a methanol bioeconomy.