Fungal unspecific peroxygenases (UPOs) are efficient biocatalysts that insert oxygen atoms into nonactivated C-H bonds with high selectivity. Many oxyfunctionalization reactions catalyzed by UPOs are favored in organic solvents, a milieu in which their enzymatic activity is drastically reduced. Using as departure point the UPO secretion mutant from Agrocybe aegerita (PaDa-I variant), in the current study we have improved its activity in organic solvents by directed evolution. Mutant libraries constructed by random mutagenesis and in vivo DNA shuffling were screened in the presence of increasing concentrations of organic solvents that differed both in regard to their chemical nature and polarity. In addition, a palette of neutral mutations generated by genetic drift that improved activity in organic solvents was evaluated by site directed recombination in vivo. The final UPO variant of this evolutionary campaign carried nine mutations that enhanced its activity in the presence of 30% acetonitrile (vol/vol) up to 23-fold over PaDa-I parental type, and it was also active and stable in aqueous acetone, methanol and dimethyl sulfoxide mixtures. These mutations, which are located at the surface of the protein and in the heme channel, seemingly helped to protect UPO from harmful effects of cosolvents by modifying interactions with surrounding residues and influencing critical loops.