In this study, crude glycerol with high potassium concentration was purified using acid treatment and used as carbon source for lipid production using Yarrowia lipolytica SKY7. The crude glycerol was purified using phosphoric acid (pH 2) followed by centrifugation. When purified glycerol was used as carbon source for fermentation, higher biomass productivity (0.54 g/L/h) and lipid productivity (0.2 g/L/h) was observed at 96 h compared to crude glycerol. Results indicated that 6.32 g/L potassium in crude glycerol medium was inhibitory for cell growth and lipid production by Y. lipolytica. Yield coefficients, productivities and specific growth rates were calculated for each glycerol medium. The process performance with purified glycerol medium was comparable to that of pure glycerol medium. A higher lipid yield was obtained in purified glycerol medium (0.21 g/g glycerol) than crude glycerol medium (0.124 g/g glycerol). During purification of crude glycerol, KH2PO4 was also produced as by-product. This study provides a way for valorization of crude glycerol with high potassium concentration for microbial lipid production.