Oxygenases are ubiquitous enzymes that catalyze the introduction of one or two oxygen atoms to unreactive chemical compounds. They require reduction equivalents from NADH or NADPH and comprise metal ions, metal ion complexes, or coenzymes in their active site. Thus, for industrial purposes, oxygenases are most commonly employed using whole cell catalysis, to alleviate the need for co-factor regeneration. Biotechnological applications include bioremediation, chiral synthesis, biosensors, fine chemicals, biofuels, pharmaceuticals, food ingredients and polymers. Controlling activity and selectivity of oxygenases is therefore of great importance and of growing interest to the scientific community. This review focuses on protein engineering of non-heme monooxygenases and dioxygenases for generating improved or novel functionalities. Rational mutagenesis based on x-ray structures and sequence alignment, as well as random methods such as directed evolution, have been utilized. It is concluded that knowledge-based protein engineering accompanied with targeted libraries, is most efficient for the design and tuning of biocatalysts towards novel substrates and enhanced catalytic activity while minimizing the screening efforts.