Biodiesel (a mixture of fatty acid methyl esters) was prepared by transesterification of yellow oleander (Thevetia peruviana) seed oil in methanol by batch reaction using a heterogeneous catalyst derived from Musa balbisiana to afford 95 wt% yield at 32 degrees C in 3 h. The biodiesel so prepared has high Cetane Number, is free from sulfur, and it conforms to ASTM D-6751 and EN 14214 standards. Combustion properties of different mixes of this biodiesel with BS-III / EURO-III petrodiesel at 5 v/v% [B5], 10 v/v% [B10], 15 v/v% [B15] and 20 v/v% [B20] were evaluated and were found to be highly compatible with commercial diesel engines. Physicochemical properties like Inorganic Acidity and Total Acidity [P-20], Ash Content [ASTM D-482], Ramsbottom Carbon Residue [ASTM D-524], Cetane Number [ASTM D-613], Cetane Index [ASTM D-976], IBP, FBP and Recovery@360 degrees C [ASTM D -86], Flash Point [IS-1448 P-20], Kinematic Viscosity@40 degrees C [ASTM D-445], Density@15 degrees C [ASTM D-1298], CFPP (Summer) [ASTM D-6371] and Water Content [ASTM D-1533] have been evaluated in the Quality Control Laboratory of Guwahati Refinery, IOCL. Total Contamination [DIN 51419], Oxidation Stability [ASTM D-2274], Polycyclic Aromatic Hydrocarbon [IP-391] and Lubricity: Corrected Scar Wear Diameter (W SD) @ 60 degrees C [ASTM D-6079] are determined by ASTM, IP, BIS, DIN-methods.