NOVELTY - Preparation of biodiesel from crude vegetable/animal oils containing high free fatty acid (FFA) involves deacidifying the crude vegetable oil by liquid-liquid extraction to obtain oil raffinate and extract; estreifying in situ the extract with acid catalyst to obtain the esterified extract and mixing it to the oil raffinate, followed by filtration to remove free suspended solids; and transesterification of oil filtrate using methanol, followed by separation of crude ester, purifying filtering the solvent to obtain the impure ester and recycling it for further use.    USE - For preparation of biodiesel from crude vegetable/animal oils (claimed).    ADVANTAGE - The method provides improved preparation of impure biodiesel; provides biodiesel with ester free of alkalinity, undesirable contaminants and high purity. The method significantly minimizes the requirement of mineral acid and base, by reducing the generation of solid effluents and generates no liquid effluents.    DETAILED DESCRIPTION - Preparation of biodiesel from crude vegetable/animal oils containing high free fatty acid (FFA) involves deacidifying the crude vegetable oil by liquid-liquid extraction with polar organic solvent in a specially designed extraction equipment either in a batch or continuous mode to obtain the resultant oil raffinate and an extract (solvent phase) containing FFA polar materials and the bioactive components; estreifying in situ the extract containing FFA with an acid catalyst by known method to obtain the resultant esterified extract and mixing it to the oil raffinate obtained in deacidifying step, followed by filtration to remove the free suspended solids (dag layer); and subjecting the resultant oil filtrate to transesterification using methanol, in presence of base catalyst, followed by the separation of crude ester from glycerol phase and purifying the crude ester either by celite adsorption after neutralization and solvent removal or directly by liquid- liquid extraction using aqueous polar organic solvent (1-20%) with a ratio of crude ester to solvent in the range of 1:1 to 1:4 to separate out the desired pure biodiesel phase and filtering the left out solvent phase after neutralization to obtain the impure ester and recycling it to the deacidifying step along with crude oil feed for further use.