This study aimed to use oleaginous microalgae to capture CO2 from biogas for improving methane content and simultaneously producing lipid. Several microalgae were screened for their ability to grow and produce lipid using CO2 in biogas. A marine Chlorella sp. was the most suitable strain for capturing CO2 and producing lipid using biogas (50% v/v CO2 in methane) as well as using 50% v/v CO2 in air. The medium and operating conditions were optimized through response surface methodology (RSM). The optimal concentrations of KNO3 and K2HPO4 were 0.80 g L-1 and 0.06 g L-1, respectively. The optimal operating conditions were: initial pH of 7.8, initial cell concentration of 10(7.5) cells mL(-1), light intensity of 4500 lux and gas flow rate of 0.03 L min(-1). After optimization, 89.3% of CO2 was removed from biogas and the methane content was increased up to 94.7%. The lipid productivity was 94.7 mg L-1 day(-1). (C) 2014 Elsevier Ltd. All rights reserved.