The aim of this study was to improve production level of llama heavy chain antibody fragments (V (HH)) in Saccharomyces cerevisiae while retaining functional characteristics. For this purpose, the DNA shuffling technique was used on llama V (HH) fragments specific for the azo-dye reactive red-6. In the DNA shuffling process, three parental llama V (HH) with high amino acid sequence identity with significant differences in production and functional characteristics were used. From these parental sequences, a S. cerevisiae library was created and 16 antigen specific shuffled V (HH) fragments were selected. We found that these shuffled V (HH) fragments were, (i) unique in sequence; (ii) composed of two or three parental sequences; (iii) in three V(HH)s point mutations occurred; and (iv) antigen specificity was not changed. The four highest producers in the yeast S. cerevisiae were selected and production, affinity, and antigen binding at 90°C were compared with parental V (HH)s. One shuffled V (HH) was enhanced both in production (3.4- fold) and affinity (four-fold). A second shuffled V (HH) displayed increased production (1.9-fold), and improved stability (2.4-fold) in antigen binding at 90°C. Structural analysis suggested that improved antigen binding is associated with the A24 → V24 substitution, which reduces the size of the hydrophobic pit at the llama V (HH) surface. We demonstrate that it is possible to improve desired characteristics of the same V (HH) fragment simultaneously using DNA shuffling. Finally, this is one of the first examples of DNA shuffling improving temperature stability of an antibody fragment.