Tetraselmis sp. is a green marine microalgae and known to produce lipids that can be transformed into biodiesel. The influence of nitrate concentration (0.00 g/L, 0.10 g/L, 0.14 g/L and 0.18 g/L) on the growth rate of Tetraselmis sp. was investigated. The marine microalgae were harvested during the exponential phase and lipid was extracted by chloroform-methanol solvent and quantified using Nile Red method. The conversion of lipid to biodiesel was performed via i) alkali-based transesterification reaction which utilized sodium hydroxide (NaOH) and ii) enzyme catalysed transesterification process which utilized immobilized lipase. The fatty acid methyl esters (FAME) components were identified using gas chromatography (GC) and then compared with the FAME standard. The results revealed that 0.18 g/L nitrate concentration was the optimal for cultivation of microalgae. However, the highest lipid content was achieved in the absence of nitrate (0.0 g/L). The biodiesel yield from the lipase catalysed transesterification process was 7 folds higher compared to the alkaline based transesterification.