Ionic liquids (ILs) containing quaternary phosphonium cations and phosphonic acid anions were explored as novel extractants for rare earths (RE) separation. They were considered to be bifunctional ionic liquid extractants (bif-ILEs), since both cations and anions of ILs were involved in the extraction. Trihexyl(tetradecyl)phosphonium his 2,4,4-trimethylpentylphosphinate (Cyphos IL 104), as a bif-ILE, together with propylene carbonate (PC), dimethyl carbonate (DMC), and soybean oil methyl ester (SBME, biodiesel) as diluents was employed in the extraction of RE(III) from aqueous solutions. Acidified Cyphos IL 104 (HNO3-Cyphos IL 104) exhibited high solubility in three diluents, and higher extraction efficiency than bis(2,4,4-trimethylpentyl)phosphinic acid (Cyanex 272) because of the coextraction of RE(III) by quaternary phosphonium cation and phosphonic acid anion in organic phase. Additionally, this coextraction mechanism could eliminate the loss of IL. The physical properties and miscibility test results indicated that SBME was an excellent solvent for RE(III) extraction. 2010 American Institute of Chemical Engineers AIChE J, 56: 2338-2346, 2010