Abstract Demand as well as increasing oil prices and climate change have attracted the attention of microalgae as a potential renewable energy source for fuel alternate to the conventional diesel. Morphological and molecular characterization using microscopy techniques, DNA sequencing using PhyML 3.0, phylogenetic analysis with an LRT program and HKY85 as a substitution form revealed the micro algal strain is Chlorella variabilis MK039712.1. The growth rate of Chlorella variabilis MK039712.1 was found to be 2.0 ± 0.50 day-1 with a biomass concentration of 2.23 ± 0.10 g dwt L-1 and a high lipid substance of 24 ± 0.6% w/w. 24.67% of lipid extraction was achieved by optimizing the concentrations of solvents and the conditions used in the modified Bligh and Dyer method adopting Central Composite Design (CCD). The optimization of various conditions of lipid extraction techniques of modified Bligh and Dyer method, therefore directed towards increasing extraction lipid yield content for biodiesel production for a well-organized technological approach. Further, the extracted lipids were subjected to compositional analysis using Gas Chromatography – Flame Ionization Detector (GC-FID) resulting in profile indicating 41.23% saturated and 52.55% unsaturated esters. The properties including density, viscosity, moisture content and corrosion inducing ability of the Chlorella variabilis MK039712.1 were also determined following ASTM methods and were found comparable to EN14111 making it a recommended alternate source for biodiesel production.