An indigenous microalga Chlorella vulgaris ESP-31 grown in an outdoor tubular photobioreactor with CO2 aeration obtained a high oil content of up to 63.2%. The microalgal oil was then converted to biodiesel by enzymatic transesterification using an immobilized lipase originating from Burkholderia sp. C20. The conversion of the microalgae oil to biodiesel was conducted by transesterification of the extracted microalgal oil (M-I) and by transesterification directly using disrupted microalgal biomass (M-II). The results show that M-II achieved higher biodiesel conversion (97.3 wt% oil) than M-I (72.1 wt% oil). The immobilized lipase worked well when using wet microalgal biomass (up to 71% water content) as the oil substrate. The immobilized lipase also tolerated a high methanol to oil molar ratio (>67.93) when using the M-II approach, and can be repeatedly used for six cycles (or 288 h) without significant loss of its original activity. (c) 2012 Elsevier Ltd. All rights reserved.