Recently, the research on conversion of biodiesel by-products to high value-added products has received much attention, due to the adverse effects of large accumulations of biodiesel by-products caused by the rapid increase in biodiesel production. Herein, this study investigated the utilization of by-products crude glycerol (CG-1 and CG-2) from two different industrial methods of biodiesel production and the favorable fermentation conditions for the high yield of β-farnesene by an engineered Escherichia coli F4, which harbored an optimized mevalonate pathway. Through analyzing by-products' components and fermentation performance, we found that CG-2 did not contain harmful impurities such as methanol and black solid impurities, and the β-farnesene production was up to 2.7g/L from CG-2, which was similar to that from pure glycerol (2.5g/L) and higher than that (2.21g/L) from CG-1. Therefore, CG-2 was more suitable for β-farnesene production than CG-1, which might provide a reference for choosing a more suitable method on practical biodiesel production. Afterward, a variety of important fermentation conditions were explored using CG-2 as a substrate in shaken flasks. Under the optimal conditions (including induced cell density 1.0, initial cell density 0.25, temperature after induction 33°C, initial medium pH6.5), the yield of β-farnesene from CG-2 reached 10.31g/L in a 5-L bioreactor, which was 2.8-fold higher than initial conditions in shake flasks and was the highest yield of β-farnesene produced from biodiesel by-products by fermentation as well. The recommended fermentation conditions in this work will provide a valuable reference for the industrial production of β-farnesene utilizing biodiesel by-products.