Waste cooking oils can be converted into fuels to provide economical and environmental benefits. One option is to use such fuels in stationary engines for electricity generation, co-generation or tri-generation application. In this study, biodiesel derived from waste cooking oil was tested in an indirect injection type 3-cylinder Lister Petter biodiesel engine. We compared the combustion and emission characteristics with that of fossil diesel operation. The physical and chemical properties of pure biodiesel (B100) and its blends (20% and 60% vol.) were measured and compared with those of diesel. With pure biodiesel fuel, full engine power was achieved and the cylinder gas pressure diagram showed stable operation. At full load, peak cylinder pressure of B100 operation was almost similar to diesel and peak burn rate of combustion was about 13% higher than diesel. For biodiesel operation, occurrences of peak burn rates were delayed compared to diesel. Fuel line injection pressure was increased by 8.5-14.5% at all loads. In comparison to diesel, the start of combustion was delayed and 90% combustion occurred earlier. At full load, the total combustion duration of B100 operation was almost 16% lower than diesel. Biodiesel exhaust gas emissions contained 3% higher CO2 and 4% lower NOx, as compared to diesel. CO emissions were similar at low load condition, but were decreased by 15 times at full load. Oxygen emission decreased by around 1.5%. Exhaust gas temperatures were almost similar for both biodiesel and diesel operation. At full engine load, the brake specific fuel consumption (on a volume basis) and brake thermal efficiency were respectively about 2.5% and 5% higher compared to diesel. Full engine power was achieved with both blends, and little difference in engine performance and emission results were observed between 20% and 60% blends. The study concludes that biodiesel derived from waste cooking oil gave better efficiency and lower NOx emissions than standard diesel.