Energy is the most significant factor influencing a nation’s economic success, social advancement, and human welfare. The increasing demand for oil and other forms of energy has fuelled the need for sustainable alternative energy sources. In this context, energy-providing biofuel materials are widely considered a sustainable alternative. Biodiesel, among other biofuel materials, is currently recognized as a valuable resource for the transportation sector on a global scale. To fulfill the growing demand for biodiesel and to ensure sustainability, the biodiesel synthesis process must be expedited. Therefore, reviewing and upgrading the technological strategies for biodiesel production is vital. The current review paper summarizes recent technological advancements in the biodiesel production process and the process parameters that influence the biodiesel production yield. Also, the significance of eco-friendly biocatalysts derived from waste biomass and waste metals for enhancing biodiesel yield has been highlighted. Furthermore, a techno-economic analysis and life cycle evaluation of different biodiesels are reviewed to examine their economic viability and environmental sustainability when produced using bio-derived catalysts. Overall, it is recognized from recent improvements in biodiesel synthesis that the processes that use catalysts generated from waste sources might considerably facilitate the transition to a more sustainable and economical biodiesel production.