Abstract: This invention relates to a process for preparing esterified karanja oil as a fuel for compressing ignition engine which process comprises the following steps - a) heating karanja oil within a range of from 5$ C to 70°C; b) adding potassium hydroxide (KOH) and methyl alcohol in predetermined amounts; c) stirring the mixture thoroughly; d) separating glycerol from said mixture in a known manner, e) washing said mixture with distilled water; and f) heating the mixture for removing water.