Alkyl esters of long chain fatty acid are called biodiesel. These esters can be obtained from vegetable oils by transesterification with methanol/ethanol. The tansesterification can be carried out chemically or enzymatically. In the present work three different lipases (Chromobacterium viscosum, Candida rugosa, and Porcine pancreas) were screened for a transesterification reaction of Jatropha oil in a solvent-free system to produce biodiesel; only lipase from Chromobacterium viscosum was found to give appreciable yield. Immobilization of lipase (Chromobacterium viscosum) on Celite-545 enhanced the biodiesel yield to 71% from 62% yield obtained by using free tuned enzyme preparation with a process time of 8 h at 40 degreesC. Further addition of water to the free (1%, w v(-1)) and immobilized (0.5%, w v(-1)) enzyme preparations enhanced the yields to 73 and 92%, respectively. Immobilized Chromobacterium viscosum lipase can be used for ethanolysis of oil. It was seen that immobilization of lipases and optimization of transesterification conditions resulted in adequate yield of biodiesel in the case of the enzyme-based process.