Lipase from Bacillus sp. isolated from the oil contaminated soil was purified by ammonium sulphate precipitation and ion-exchange chromatography with a 5.1-fold purification and 10.5% yield. SDS-PAGE analysis of the enzyme revealed the molecular mass of 24 kDa. The optimum pH and temperature for lipase activity were 6.5 and 37 degrees C, respectively. The isolated lipase was stimulated by pretreatment with methanol and ethanol as well as by divalent metal ions Ca2+, Mg2+ and Mn2+. The enzyme showed high activity towards oleic rich oils. The enzyme immobilized on celite could retain 90% lipase activity-after eight cycles. Transesterification of Botryococcus sp. oil using the immobilized enzyme for 40 h resulted in 80% yield of fatty acid methyl esters which had good properties for use as biodiesel. Overall results suggested that the solvent tolerant Bacillus lipase can be a potential biocatalyst for methyl ester production. (C) 2015, The Society for Biotechnology, Japan. All rights reserved.