An inexpensive self-made immobilized lipase from Penicillium expansum was shown to be an efficient biocatalyst for biodiesel production from waste oil with high acid value in organic solvent. It was revealed that water from the esterification of free fatty acids and methanol prohibited a high methyl ester yield. Adsorbents could effectively control the concentration of water in the reaction system, resulting in an improved methyl ester yield. Silica gel was proved to be the optimal adsorbent, affording a ME yield of 92.8% after 7 h. Moreover, the enzyme preparation displayed a higher stability in waste oil than in corn oil, with 68.4% of the original enzymatic activity retained after being reused for 10 batches. (C) 2009 Elsevier Ltd. All rights reserved.