Previously, we have developed and characterized a genetic selection for protein folding and solubility in living bacterial cells based on the inherent “proofreading” mechanism of the bacterial twin-arginine translocation (Tat) pathway. Here we report an extension of this selection strategy to isolate recombinatorial stable single-chain immunotherapeutics derived from multimeric molecules, in the reducing cytoplasm of E. coli. This is significant as members of this class of recombinant protein are typically targeted for folding in the oxidizing environment of the bacterial periplasm. We will discuss our recent efforts to employ this selection for the directed evolution of cytoplasmically-stable single-chain antibody fragments (scFvs) and recombinant T-cell receptor ligands (RTLs). By allowing the bacterial Tat pathway to exert folding quality control on expressed target protein sequences, we have generated a powerful tool for molecular engineering of solubility-enhanced proteins with great clinical promise for the treatment of a range of human disorders.