Abstract: The present study was aimed to purify and characterize extracellular lipase from Trichosporon asahii MSR54. An extracellular 27 kDa lipase from T. asahii was purified by anion exchange chromatography with 2.14 purification fold. It was magnesium stimulated. Reversible inhibition of EDTA was found to be by adding 15 mM magnesium chloride confirming its metallo nature. The temperature and pH optima for activity was 40°C and pH 9.0, respectively. It’s Km and Vmax was found to be 55.5 μM and 6.66 mM min-1, respectively using p-nitrophenyl palmitate as a substrate. The present enzyme hydrolysed a large array of oils and triacylglycerides with better specificity on corn oil and triolein, respectively. It was 1,3-regioselective during hydrolysis of triolein in aqueous as well as in micro-aqueous environment. It was stable towards most of the polar and non-polar solvents including methanol, DMSO, benzene. The present enzyme yielded 87.6% conversion of coconut oil to biodiesel after overnight incubation at 45°C.