The ever-increasing demand of energy has made it imperative to increase the production of renewable fuels like ethanol. Many studies have reported increase in ethanol production by reducing fermentation by-products like glycerol. Deletion of structural genes like gpd1and gpd2 leads to an increase in ethanol by reducing glycerol; however, it makes the yeast osmosensitive that is not desirable for industrial strains. In this study, genes in the HOG pathway which regulates glycerol synthesis in Saccharomyces cerevisiae were targeted for improving ethanol yields in fermentation of sugarcane molasses. Deletion strains of ssk1, hot1, and smp1 were tested and they did not show osmosensitivity. Δssk1 and Δsmp1 recombinant strains showed consistent improved ethanol yields. As a result, a double-deletion strain, Δssk1Δsmp1, was also constructed, which showed a synergistic effect leading to 6% increase in ethanol yield and 35% decrease in glycerol yield. It was also observed that there was a significant decrease in acetic acid yields of all the recombinant strains. Overall, the study demonstrates an industrially viable technique of engineering the HOG pathway resulting in decrease of glycerol and no loss of osmotolerance. These S. cerevisiae strains showed a significant increase in ethanol yields.