Utilization of industrial waste as substrates for the rhamnolipid synthesis by Pseudomonas aeruginosa is a worthy alternative for conventionally used vegetable oils and fatty acids to reduce the production cost of rhamnolipid. Sunflower acid oil (SAO), a by‐product of the oil industry, contains 70% 18:0 fatty acid, with oleic acid as a major component. In this scope, production and analysis of rhamnolipid was successfully demonstrated using SAO as a new substrate. Pseudomonas aeruginosa produced rhamnolipid (a glycolipid biosurfactant) at a maximum concentration of 4.9 g L−1 with 60 g L−1 of SAO in the medium. Structural properties of rhamnolipid biosurfactant are confirmed using thin layer chromatography (TLC), high performance liquid chromatography (HPLC), and fourier transformed infrared spectroscopy (FTIR) analysis. Further surface‐active properties of the crude rhamnolipid were evaluated by measuring surface tension and emulsification properties. The synthesized rhamnolipid reduced the surface tension of water to 30.12 mN m−1 and interfacial tension (against heptane) to 0.52 mN m−1. Moreover, rhamnolipid shows the highest emulsification index (above 80%) for vegetable oils. This study confirms the use of SAO as a potential substrate for rhamnolipid production. The synthesized rhamnolipid was incorporated in liquid detergent formulation along with alpha olefin sulfonate (AOS) and sodium lauryl ether sulfate (SLES). The performance properties including foaming and cleaning efficiency of liquid detergent were compared.