Terpenes have numerous applications, ranging from pharmaceuticals to fragrances and biofuels. With increasing interest in producing terpenes sustainably and economically, there has been significant progress in recent years in developing methods for their production in microorganisms. In Saccharomyces cerevisiae, production of the 20-carbon diterpenes has so far proven to be significantly less efficient than production of their 15-carbon sesquiterpene counterparts. In this report, we identify the modular structure of geranylgeranyl diphosphate synthesis in yeast to be a major limitation in diterpene yields, and we engineer the yeast farnesyl diphosphate synthase Erg20p to produce geranylgeranyl diphosphate. Using a combination of protein and genetic engineering, we achieve significant improvements in the production of sclareol and several other isoprenoids, including cis-abienol, abietadiene and β-carotene. We also report the development of yeast strains carrying the engineered Erg20p, which support efficient isoprenoid production and can be used as a dedicated chassis for diterpene production or biosynthetic pathway elucidation. The design developed here can be applied to the production of any GGPP-derived isoprenoid and is compatible with other yeast terpene production platforms.