In this work, whole Japropha curcas L. seed kernels were firstly treated in subcritical water (448 K, 2.0 MPa initial N2, 15 min, kernel to water ratio 0.5 g g1) and then the treated kernels were used in the in situ production of biodiesel using a solvent mixture of 75% methanol and 25% acetic acid. It was found that hydrolysate collected from subcritical water treatment of seed kernels contained reducing sugars and can be used to grow Yarrowia lipolytica without the need of detoxification. The in-situ (trans)esterification was successfully optimized using Taguchi design of experiments and a high yield of 101.7 and 65.1 g FAME per 100 g of extractable lipid and dry kernel, respectively could be achieved under optimized conditions (523 K, 3.0 MPa initial CO2 and 7.5 cm3 g1 solvent to solid ratio). The developed process can tolerate high FFA and moisture content in feedstock.