Plants, such as Arabidopsis thaliana and Selaginella lepidophylla, contain genes homologous with the trehalose-6-phosphate synthase (TPS) genes of bacteria and fungi. Most plants do not accumulate trehalose with the desert resurrection plant S. lepidophylla, being a notable exception. Overexpression of the plant genes in a Saccharomyces cerevisiae tps1 mutant results in very low TPS-catalytic activity and trehalose accumulation. We show that truncation of the plant-specific N-terminal extension in the A. thaliana AtTPS1 and S. lepidophylla SlTPS1 homologues results in 10-40-fold higher TPS activity and 20-40-fold higher trehalose accumulation on expression in yeast. These results show that the plant TPS enzymes possess a high-potential catalytic activity. The growth defect of the tps1 strain on glucose was restored, however, the proper homoeostasis of glycolytic flux was not restored, indicating that the plant enzymes were unable to substitute for the yeast enzyme in the regulation of hexokinase activity. Further analysis of the N-terminus led to the identification of two conserved residues, which after mutagenesis result in strongly enhanced trehalose accumulation upon expression in yeast. The plant-specific N-terminal region may act as an inhibitory domain allowing modulation of TPS activity.