Although fossil fuels remain the main source of energy, the volume of renewable sources of energy is constantly increasing. Biodiesel is a promising alternative fuel due to the number of advantages compared to fossil fuel and other types of biofuel. The specific objective of this study was to identify the difference between conventional and novel technologies applied during the whole life cycle of biodiesel production and consumption. The study offers some important insights into the recent advances in the biodiesel industry including biodiesel production from microalgal lipids, advanced homogenous and enzymatic transesterification, non-catalytic supercritical transesterification, application of microwave and ultrasound assisting technologies. Considering all the factors affecting the efficiency and safety of the biodiesel production process, here we reviewed the main principals and recent achievements in the environmental life cycle assessment of biodiesel production and consumption.