Despite the significant amount of experimental data available on trehalose, the molecular mechanism responsible for its intracellular stabilising properties has not emerged yet. The repair of cellular homeostasis in many protein-misfolding diseases by trehalose is credited to the disaccharide being an inducer of autophagy, a mechanism by which aggregates of misfolded proteins are cleared by the cell. In this work, we expressed the pathogenic N-terminal fragment of huntingtin in Δnth1 mutant (unable to degrade trehalose) of Saccharomyces cerevisiae BY4742 strain. We show that the presence of trehalose resulted in the partitioning of the mutant huntingtin in the soluble fraction of the cell. This led to reduced oxidative stress and improved cell survival. The beneficial effect was independent of the expression of the major cellular antioxidant enzyme, superoxide dismutase. Additionally, trehalose led to the overexpression of the heat shock protein, Hsp104p, in mutant huntingtin-expressing cells, and resulted in rescue of the endocytotic defect in the yeast cell. We propose that at least in the initial stages of aggregation, trehalose functions as a stabiliser, increasing the level of monomeric mutant huntingtin protein, with its concomitant beneficial effects, in addition to its role as an inducer of autophagy.