Municipal wastewater sludge is a promising lipid feedstock for biodiesel production, but the need to eliminate the high water content before lipid extraction is the main limitation for scaling up. This study evaluates the economic feasibility of biodiesel production directly from liquid primary sludge based on experimental data at laboratory scale. Computational tools were used for the modelling of the process scale-up and the different configurations of lipid extraction to optimise this step, as it is the most expensive. The operational variables with a major influence in the cost were the extraction time and the amount of solvent. The optimised extraction process had a break-even price of biodiesel of 1232 $/t, being economically competitive with the current cost of fossil diesel. The proposed biodiesel production process from waste sludge eliminates the expensive step of sludge drying, lowering the biodiesel price. (C) 2016 Elsevier Ltd. All rights reserved.