In the search for environmentally acceptable alternative fuels for diesel engines, biodiesel is a tempting option. Still, the long-term repercussions are excessive noise and vibration, as well as irregular and unpredictable combustion, which leads to knocking. In this study, an attempt was made to study the vibrational behavior of diesel engines fuelled with neat diesel and jatropha biodiesel blends (BJ0, BJ10, BJ20, BJ30, and BJ40) and lubrication oil degradation at different operating time periods (40, 60, 80 and 100 h). Vibration analysis is done through the measurement of horizontal and vertical frequencies and physical characteristics of lubrication are done through the determination of viscosity and density. Observation shows that there is a definite relationship between the degradation of oil and the vibration signatures of the engine. It is observed that BJ20 is the best-suited fuel for optimized performance. The highest frequency of vibration is reported in the frequency range of 1039–1041 Hz. The present study provides the guidelines for condition monitoring of bio fuelled engines for proper maintenance and scheduling change of oil.