This research reports cultivation of microalgae (Chlorella vulgaris) in a locally designed and fabricated closed tubular photo bioreactor and the subsequent extraction using super critical fluid extraction. Microalgae oil yield at various temperatures and pressures is reported. The algal oil is then transesterified into biodiesel using an in-house developed new heterogeneous catalyst. The process eliminates the undesirable saponification, apart from increasing the yield, reducing the reaction temperature, and substantially increasing reaction rate, thus providing the basis for benefiting the biofuel production economy directly. The biodiesel produced using the proprietary catalyst is then characterized by using analytical techniques like gas chromatography/ mass spectrometry and nuclear magnetic resonance.