Transesterification of soybean oil in supercritical methanol has been carried out in the absence of catalyst. A co-solvent was added to the reaction mixture in order to decrease the operating temperature, pressure and molar ratio of alcohol to vegetable oil. With CO2 as co-solvent in the reaction system, there was a significant decrease in the severity of the conditions required for supercritical reaction. It was demonstrated that, with an optimal reaction temperature of 280 degrees C, methanol to oil ratio of 24 and CO2 to methanol ratio of 0.1, a 98% yield of methyl esters (biodiesel) was observed in 10 min at a reaction pressure of 14.3 MPa, which makes the production of biodiesel using supercritical methanol viable as an industrial process. Furthermore, the production process is environmentally friendly. (c) 2005 Elsevier Ltd. All rights reserved.