A continuous-flow membrane reactor was constructed for the production of fatty acid methyl ester (FAME) from waste vegetable oil with high free fatty acid (FFA) content. FAME was produced via base-catalysed transesterification with methanol at two FFA levels: 4.8 and 10mass%. The effect of the ceramic membrane pore size on the separation of soap and triglycerides from the FAME in the reactor was investigated. In all cases, the triglyceride was completely retained in the reactor, yielding free and total glycerine contents in the produced FAME significantly below the maximum limits of the ASTM D6751 standard. The soaps produced in the reaction mixture were not completely retained in the reactor and did not affect the FAME production process. (c) 2012 Canadian Society for Chemical Engineering