Fatty acid photodecarboxylase (FAP), a microalgal enzyme, is one of the rare photoenzymes found in nature. Since its discovery in 2017, FAP has made a huge impact in the field of photobiocatalysis, being so far the only photoenzyme with potential applicability for organic synthesis. Furthermore, among all studied enzymes to date, FAP is one of the most promising candidates for in vitro feasible biofuel production from oil. One field of study for FAP has been broadening its substrate scope and modulating substrate selectivity. In order to get insight into the enzyme’s substrate selectivity, as well as to generate a toolbox of mutant enzymes with distinct substrate preferences toward medium- and long-chain fatty acids, in this work, we carried out extensive mutagenesis of the active-site residues of FAP from Chlorella variabilis (CvFAP). Particularly, we performed partial-site saturation mutagenesis for the Y466 position due to its key location at the active site. Our experimental and computational analysis indicated a correlation between the exchanged amino acid type and the observed activity, demonstrating that the conventional binding mode of long-chain fatty acids is destabilized by charged amino acid residues, leading to a nonproductive binding conformation characterized by a compact folded form. Mutagenesis of other key residues around the substrate binding site led to variants with selectivity toward medium-chain or long-chain fatty acids. For example, we obtained enzyme variants that are highly selective toward either C12:0, C14:0, or C18:0/C18:1 fatty acids. Selectivity patterns agreed very well with the distances between the FAD cofactor and substrate, as calculated by our molecular dynamics simulations. Furthermore, we report unexplored activity of the wild-type CvFAP toward C20:1 and C22:1 fatty acids, which are major components of jojoba oil and rapeseed oil, respectively.