This study investigates the optimization of biodiesel production from Chlorella vulgaris microalgae using transesterification process parameters. Response Surface Methodology (RSM) with a Box-Behnken design was employed to evaluate the effects of methanol-to-oil molar ratio (3:1–9:1), catalyst concentration (0.5–1.5 wt%), and reaction temperature (45–65°C) on fatty acid methyl ester (FAME) yield. The optimized conditions were determined as 6.8:1 molar ratio, 1.1 wt% KOH catalyst, and 58°C reaction temperature, yielding 94.3% FAME content. The produced biodiesel met ASTM D6751 and EN 14214 standards with kinematic viscosity of 4.8 mm²/s and cetane number of 52.4. Life cycle assessment revealed 68% reduction in greenhouse gas emissions compared to petroleum diesel. These findings demonstrate the viability of microalgae as a sustainable feedstock for third-generation biofuel production.