Methyl esters of palm oil and rice bran oil were tested in a direct injection, naturally aspirated, single cylinder diesel engine. The diesel engine was operated with biofuels from no load to full load condition. The effects of different biofuels on engine parameters, namely, fuel consumption, electrical efficiency, lower heating value, higher heating value, and engine speed, were examined; also, the physical and chemical properties, such as specific gravity, moisture content, refractive index, acid value, iodine number, saponification value, and peroxide value, of the two methyl esters used in this study were estimated. Based on the Cetane number and iodine value, the methyl esters obtained from palm oil were found to be not suitable to use as biodiesel in cold weather conditions, but for hot climate conditions, biodiesel obtained from palm and rice bran sources were found to be suitable. Based on electrical efficiency, the methyl esters obtained from palm oil were found to be very good.