2′-Fucosyllactose (2′-FL), a human milk oligosaccharide with confirmed benefits for infant health, is a promising infant formula ingredient. Although Escherichia coli, Saccharomyces cerevisiae, Corynebacterium glutamicum, and Bacillus subtilis have been engineered to produce 2′-FL, their titers and productivities need be improved for economic production. Glucose along with lactose have been used as substrates for producing 2′-FL, but accumulation of by-products due to overflow metabolism of glucose hampered efficient production of 2′-FL regardless of a host strain. To circumvent this problem, we used xylose, which is the second most abundant sugar in plant cell wall hydrolysates and is metabolized through oxidative metabolism, for the production of 2′-FL by engineered yeast. Specifically, we modified an engineered S. cerevisiae strain capable of assimilating xylose to produce 2′-FL from a mixture of xylose and lactose. First, a lactose transporter (Lac12) from Kluyveromyces lactis was introduced. Second, a heterologous 2′-FL biosynthetic pathway consisting of enzymes Gmd, WcaG, and WbgL from E. coli was introduced. Third, we adjusted expression levels of the heterologous genes to maximize 2′-FL production. The resulting engineered yeast produced 25.5 g/L of 2′-FL with a volumetric productivity of 0.35 g/L∙h in a fed-batch fermentation with lactose and xylose feeding to mitigate the glucose repression. Interestingly, the major location of produced 2′-FL by the engineered yeast can be changed using different culture media. While 72% of the produced 2′-FL was secreted when a complex medium was used, 82% of the produced 2′-FL remained inside the cells when a minimal medium was used. As yeast extract is already used as food and animal feed ingredients, 2′-FL enriched yeast extract can be produced cost-effectively using the 2′-FL-accumulating yeast cells.