Magnetic nanoparticles were prepared by coprecipitating Fe(2+) and Fe(3+) ions in a sodium hydroxide solution and used as support for lipase. The lipase-coated particles were applied in a reactive extraction process that allowed separation of the products formed during transesterification. Kinetics data for triolein and ethanol consumption during biodiesel (ethyl oleate) synthesis together with a thermodynamic phase equilibrium model (liquid-liquid) were used for simulation of batch and continuous processes. The analysis demonstrated the possibility of applying this biocatalytic system in the reactive zone using external magnetic fields. This approach implies new advantages in efficient location and use of lipases in column reactors for producing biodiesel. (C) 2010 Elsevier Ltd. All rights reserved.