The biodiesel fuel ethyl oleate (fatty acid ethyl ester, FAEE) was produced using Novozym (R) 435 (immobilized lipase) by transesterification of a mixture of ethanol and triolein in a fixed-bed reactor operated in circulating batch mode. The miscibility of the mixtures during transesterification was predicted thermodynamically and the conversion ratio of triolein was studied as a function of reaction time. The yield of ethyl oleate increased when the feed molar composition of ethanol was increased. The glycerin by-product could be removed from the enzyme particles by the circulating feed mixture. The inactivation of Novozym (R) 435 by glycerin was also examined in the circulating batch mode experiments, and an effective reaction model was proposed to describe the inactivation of Novozym (R) 435 and ethanol effect during the transesterification reaction by using the modified Michaelis-Menten equation.