A lipase producing bacterium was isolated from button mushroom bed, which showing high clear zone on agar media containing Tributyrin as the substrate. The strain was identified as Burkholderia cepacia by analysis of 16S rDNA gene sequence. Crude lipase (CL) was partially purified from 70% ammonium sulfate precipitation using the culture filtrate of B. cepacia. Immobilized lipases were prepared by cross-linking method with CL from B. cepacia and Novozyme lipase (NL) onto silanized Silica-gel as support. Residual activitiy of the immobilized CL (ICL) and immobilized NL (INL) was maintained upto 61% and 72%, respectively. Biodiesel (Fatty acid methyl ester, FAME) was recovered by transesterification and methanolysis of Canola oil using NaOH, CL and ICL as the catalysts to compare the composition of fatty acids and the yield of FAME. Total FAME content was NaOH 781 mg L-1, CL 681 mg L-1 and ICL 596 mg L-1, in which the highest levels of FAME was observed to 50% oleic acid (C18:1) and 22% stearic acid (C18:0). In addition, the unsaturated FAME (C18:1, C18:2) decreased, while saturated FAME (C16:0, C18:0) increased according to increasing the reaction times with both CL and ICL, supporting CL possess both transesterification and interesterification activity. When reusability of ICL and INL was estimated by using the continuous reaction of 4 cycles, the activity of ICL and INL was respectively maintained 66% and 79% until the fourth reaction.