Zearalenone (ZEN) is one of the most common mycotoxins in maize, wheat, barley, sorghum, rye and other grains. ZEN contamination in feed is an international health issue due to its estrogenicity by competitively binding to estrogen receptors. Enzymatic detoxification of ZEN is superior to physical and chemical methods in terms of safety, environmental impact and preserving nutritional value and palatability, but is hampered by both the currently limited repertoire of detoxifying enzymes and the lack of knowledge about their structure-function relationships. In this study, a ZEN lacton hydrolase candidate (ZHD11C) was identified from thermo-tolerant Fonsecaea multimorphosa CBS 102226, and characterized to be more thermostable than these reported homologues. An intriguing feature of ZHD11C is that the N-terminal hydrophobicity affects its thermal stability and causes conformational change of a domain far from the N-terminal. This finding was successfully applied to enhance the thermostability of the most active ZEN lacton hydrolase ZHD518 through rationally tailoring its N-terminal hydrophobicity. Our results not only provide more insights into the structure-function relationships of ZEN lacton hydrolases, but generate better candidate for bio-decontamination of zearalenone in feed industries.