The most promising renewable alternative fuel, biodiesel, is produced from various lipid sources. Primary and secondary sludge of municipal wastewater treatment facilities are potential sources of lipids. In this study, factorial experimental analyses were used to study the influence of different variables on the lipid extraction and biodiesel production from dried municipal primary and secondary sludge (Adelaide Pollution Control Plant, London, ON, Canada). The empirical models were developed for each factorial analysis. The temperature turned out to be the most significant variable for lipid extraction by using methanol and hexane as solvents. Extraction using methanol resulted in a maximum of 14.46 (wt/wt) % and 10.04 (wt/wt) % lipid (on the basis of dry sludge), from the primary and secondary sludge sources respectively. A maximum of 11.16 (wt/wt) % and 3.04 wt/wt% lipid (on the basis of dry sludge) were extracted from the primary and secondary sludge sources, respectively, using hexane as a solvent. The FAME (fatty acid methyl ester) yield of the H2SO4 catalyzed esterification-transesterification of the hexane and methanol extracted lipids were 41.25 (wt/wt) % and 38.94(wt/wt) % (on the basis of lipid) for the primary sludge, and 26.89 (wt/wt) % and 30.28 (wt/wt) % (on the basis of lipid) for the secondary sludge. The use of natural zeolite as a dehydrating agent was increased the biodiesel yield by approximately 18 (wt/wt) % (on the basis of lipid). The effect of temperature and time was also investigated for biodiesel production from the lipid of wastewater sludge. The yield and quality of the FAME were determined by gas chromatography. (C) 2011 Elsevier B.V. All rights reserved.