Lipase enzyme-mediated processes have biological significance and tremendous potential in various industrial and technological areas due to the enzymatic properties and broad specificity for a wide spectrum of substrates. This research involved the production of hydrolytic lipase enzyme by Aspergillus terreus extracted from petroleum-contaminated soil and optimising the environmental parameters that may affect lipase production. Hydrolytic lipase enzyme activity of the isolated Aspergillus terreus from petroleum-contaminated soil was undertaken in submerged fermentation. Dry cell weight, lipase enzyme pellets, and lipase enzyme concentration by measuring the percentage transmission by spectrophotometry were measured to determine the effects of various abiotic factors (pH, temperature, carbon and nitrogen sources, lipid substances and vegetable oils) affecting cell growth and lipase enzyme production by Aspergillus terreus on modified lipase production media. The results showed a precipitate on Tween 20 and a bright pink-fluorescent halo on the rhodamine B agar plate. After temperature adjustment to 35 °C, statistical analysis showed that Aspergillus terreus produced a dry cell weight of 3.14 g/L and a lipase enzyme pellet of 0.33 g with a spectrophotometric transmission of 0.03%. The sucrose substrate displayed a dry cell weight of 3.11 g/L and a lipase enzyme pellet of 1.15 g. Spectrophotometric analysis showed that sucrose, glucose and peptone had a similarity in transmission at p = 0.321. The addition of Neem oil improved enzyme yield as a dry cell weight of 3.02 g/L and a lipase enzyme pellet of 0.95 g was obtained. Statistically, sunflower and tributyrin similarly affected enzyme production by showing a spectrophotometric transmission at p = 0.024. This study has indicated that Aspergillus terreus could be employed as a reliable source of lipase enzymes for industrial processes due to its stability across different abiotic factors.