Alcoholism induces folate deficiency and increases the risk for embryonic anomalies. However, the interplay between ethanol exposure and embryonic folate status remains unclear. To investigate how ethanol exposure affects embryonic folate status and one-carbon homeostasis, we incubated zebrafish embryos in ethanol and analyzed embryonic folate content and folate enzyme expression. Exposure to 2% ethanol did not change embryonic total folate content but increased the tetrahydrofolate level approximately 1.5-fold. The expression of 10-formyltetrahydrofolate dehydrogenase (FDH), a potential intracellular tetrahydrofolate reservoir, was increased in both mRNA and protein levels. Overexpressing recombinant FDH in embryos alleviated the ethanol-induced oxidative stress in ethanol-exposed embryos. Further characterization of the zebrafish fdh promoter revealed that the ؊124/؉40 promoter fragment was the minimal region required for transactivational activity. The results of site-directed mutagenesis and binding analysis revealed that Sp1 is involved in the basal level of expression of fdh but not in ethanol-induced upregulation of fdh. On the other hand, CEBP␣ was the protein that mediated the ethanol-induced upregulation of fdh, with an approximately 40-fold increase of fdh promoter activity when overexpressed in vitro. We concluded that upregulation of fdh involving CEBP␣ helps relieve embryonic oxidative stress induced by ethanol exposure.