Improving stress tolerance is a major goal for agriculture. Trehalose is a key molecule involved in drought tolerance in anhydrobiotic organisms. Here we describe the construction of a chimeric translational fusion of yeast trehalose-6-phosphate synthase and trehalose-6-phosphate phosphatase. This construct was overexpressed in yeast cells displaying both TPS and TPP enzyme activities and trehalose biosynthesis capacity. In Arabidopsis thaliana, the gene fusion was overexpressed using either the 35S promoter or the stress-regulated rd29A promoter. Transgene insertion in the genome was checked by PCR and transcript expression by RT-PCR. Several independent homozygous lines were selected in the presence of kanamycin and further analyzed. Trehalose was accumulated in all these lines at low levels. No morphological or growth alterations were observed in lines overexpressing the TPS1-TPS2 construct, whereas plants overexpressing the TPS1 alone under the control of the 35S promoter had aberrant growth, color and shape. TPS1-TPS2 overexpressor lines were glucose insensitive, consistent with a suggested role of trehalose/T6P in modulating sugar sensing and carbohydrate metabolism. Moreover, TPS1-TPS2 lines displayed a significant increase in drought, freezing, salt and heat tolerance. This is the first time that trehalose accumulation in plants is shown to protect against freezing and heat stress. Therefore, these results demonstrate that engineering trehalose metabolism with a yeast TPS-TPP bifunctional enzyme confers multiple stress protection in plants, comprising a potential tool to improve stress-tolerance in crops.