This study reports on a novel two-step process for biodiesel production consisting of hydrolysis of oils in sub-critical water and subsequent supercritical dimethyl carbonate esterification. This process found to occur optimally at the sub-critical water treatment (270 degrees C/27 MPa) for 25 min followed by a subsequent supercritical dimethyl carbonate treatment (300 degrees C/9 MPa) for 15 min to achieve a comparably high yield of fatty acid methyl esters, at more than 97 wt%. In addition, the fatty acid methyl esters being produced satisfied the international standard specifications for use as biodiesel fuel. This new process for biodiesel production offers milder reaction condition (lower temperature and lower pressure), non-acidic, non-catalytic and applicable to feedstock with high amount of free fatty acids such as crude Jatropha curcas oil. (C) 2009 Elsevier Ltd. All rights reserved.