Dairy waste scum obtained from downstream process of milk production is a potential source for production of biodiesel. It is a less dense floating solid mass that majorly consists of triglycerides of fatty acids which are important constituents for a fuel. This book aims to produce biodiesel using dairy waste scum via transesterification process using sodium/potassium hydroxide (NaOH/KOH) catalyst. The experimental results lead to an yield of 89.02% of biodiesel using NaOH catalyst with optimized process parameters of temperature of 55oC, reaction time of 120 min and catalyst loading of 1wt/wt.%. Further, it observed that the addition of catalysts has negative effect in production of biodiesel may be due to the competitive reaction path ways on surface of catalyst which needs thorough investigation. Finally, the obtained biodiesel was tested for emission and combustion characteristics in a compression ignition engine. The experimental results using MINITAB19 and the predicted yields using ANOVA were reported the outcomes will not only support low-cost economic strategy of biodiesel production but also paves path towards understanding the molecular mechanism on catalytic surface.