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Biodiesel from inedible sources has become prominent in last few decades. But it is economically incompatible with petroleum diesel. At the same time, both petro-diesel and biodiesels are concerned with environmental pollution, global warming, etc. Algae, on the other hand, utilize CO₂ for their growth and can minimize some sort of pollution level and results in carbon credit for a country. In Punjab, India, algae are seen to grow in many water bodies. But all those are taken away and dumped in vats. Some of this huge biomass was used for production of biodiesel in this work. Extraction of oil from algae was conducted by using Soxtherm (solvent extraction). An amount of 9 wt% of algal oil was extracted by comparatively costly hexane, whereas 8% extraction was done by cheaper acetone. In the transesterification reaction, molar ratio (methanol: oil) of 6:1, catalyst (KOH) concentration of 3 wt%, reaction temperature of 60℃, 60 min reaction time and a settling time of 2.5 h were found to be optimum conditions to get maximum ester with minimum free fatty acid content and viscosity. A statistical analysis for the transesterification procedure also showed a methanol-to-oil molar ratio of 6:1 and catalyst concentration of 3 wt% to be the optimum. Characterization of biodiesel was done and compared with ASTM/BIS standards. Most important properties of biodiesel ester like viscosity (3.12 cSt or 3.12 mm²/s), cloud and pour point (-1 and -6 ℃, respectively), flash and fire point (153 and 158℃), carbon residue content (0.03%), acid number (0.36 mg of KOH/gm) were within the range of concerned standards.