A new kind of polyol based on rape seed oil for use in rigid polyurethane foam was synthesized and characterized. The synthesis of such a polyol was divided into two steps. The first step was the hydroxylation of the double bonds existing in the long chains of the unsaturated aliphatic hydrocarbon of rape seed oil with peroxy acid. The second step was use of the alcoholysis of the hydroxylated rape seed oil with triethanolamine to increase the hydroxyl value of the product. The reaction process was monitored by means of a novel on-line infrared spectrometer. Rigid polyurethane foam was produced with this rape seed oil based polyol and some physical properties of the foam were examined and compared with a reference foam.