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Water-in-oil emulsion droplets are an attractive format for ultrahigh-throughput screening in functional metagenomics and directed evolution applications that allow libraries with more than 107 members to be characterized in a day. Single library members are compartmentalized in droplets that are generated in microfluidic devices and tested for the presence of target biocatalysts. The target proteins can be produced intracellularly, for example, in bacterial hosts in-droplet cell lysis is therefore necessary to allow the enzymes to encounter the substrate to initiate an activity assay. Here, we present a titratable lysis-on-demand (LoD) system enabling the control of the cell lysis rate in Escherichia coli. We demonstrate that the rate of cell lysis can be controlled by adjusting the externally added inducer concentration. This LoD system is evaluated both at the population level (by optical density measurements) and at the single-cell level (on single-cell arrays and in alginate microbeads). Additionally, we validate the LoD system by droplet screening of a phosphotriesterase expressed from E. coli, with cell lysis triggered by inducer concentrations in the μM range. The LoD system yields sufficient release of the intracellularly produced enzymes to bring about a detectable quantity of product (measured by fluorescence in flow cytometry of double emulsions), while leaving viable cells for the downstream recovery of the genetic material.