The technical and economic feasibility of an alternative process for biodiesel production from residual oil and fats (ROF) was compared to two cases of the conventional two-step alkali-catalyzed process. A reliable set of thermophysical properties, kinetic data, and a rigorous thermodynamic modeling were used in the simulations. The alternative process employed liquid liquid extraction to separate the free fatty acids from triacylglycerols, with methanol as the solvent. Both processes were found to be technically feasible based on a design specification of 99.65% esters for the product. The alternative process proved to be slightly more economically viable than the conventional process based on the selected economic indicators and thus is a promising alternative for biodiesel production from ROF.