The extraction of oil from algae with ethanol using Soxhlet extraction apparatus was done and a substantial amount of oil obtained. The production of biodiesel was demonstrated by transesterification reaction process considering parameters such as reaction temperature, reaction time, methanol-to-oil molar ratio and catalyst concentration. At the end of the research the algae oil yielded biodiesel up to 90% at a temperature of 650C, under a period of 110 minutes reaction time, molar ratio of 3:1 and a catalyst concentration of 1.25wt %. The characterization results show density, specific gravity, pour point, flash point, cloud point, kinematic viscosity, cetane number and free fatty acid to be0.863 Kg/m3, 0.868126, 278.90K, 440.00K, 284.00K, 5.49m2/s, 49.50 and 0.51% agreeing with the ASTM D6757 standard of 0.84-90Kg/m3, 0.88, 258-289K, 373-443K, 270-285K, 1.50-6.0m2/s and 48-60, 0.50% in that order. Two of these properties - iodine value and acid value with 91.24gl2/100 and 0.60mKOH/g slightly do not come in consonant with ASTM D6757 having 120.0gl2/100 and 0.50mKOH/g respectively. In the overall, algae oil is a good potential renewable feedstock for the production of biodiesel.