Microbial production of monoterpenoid indole alkaloids (MIAs) provides a sustainable and eco-friendly means to obtain compounds with high pharmaceutical values. However, efficient biosynthesis of MIAs in heterologous microorganisms is hindered due to low supply of key precursors such as geraniol and its derivative 8-hydroxygeraniol catalyzed by geraniol 8-hydroxylase (G8H). In this study, we developed a facile evolution platform to screen strains with improved yield of geraniol by using the SCRaMbLE system embedded in the Sc2.0 synthetic yeast and confirmed the causal role of relevant genomic targets. Through genome mining, we identified several G8H enzymes that perform much better than the commonly used CrG8H for 8-hydroxygeraniol production in vivo. We further showed that the N-terminus of these G8H enzymes plays an important role in cellular activity by swapping experiments. Finally, the combination of the engineered chassis, optimized biosynthesis pathway, and utilization of G8H led to the final strain with more than 30-fold improvement in producing 8-hydroxygeraniol compared with the starting strain. Overall, this study will provide insights into the construction and optimization of yeast cells for efficient biosynthesis of 8-hydroxygeraniol and its derivatives.