Algae biomass could be possible valuable resources towards the relief from upcoming petroleum indigence. The local algal diversity was exploited in order to find suitability for extraction of biofuel. In this study, locally available biomass was successfully cultured in the outdoor bioreactor and the effects of various common lipid extraction methods were quantified on the basis of gravimetric estimation. Finally, FAME was studied qualitatively by Gas chromatography-mass spectrometry, to check their suitability for biodiesel standards. Obtained results conform that among considered population predominant species were found to be Chlorella, Anabaena, Euglena, Oocystis and Sphaerocystis. Combination of dried algal biomass with the Folchâ€™s method yields >27% lipid which is comparatively higher than the traditional Soxhlet methodology i.e. 15%. More than 50 % of total fatty acids consists of carbon 18 acids i.e. linolenic acid (C18:3), linoleic acid (C18:2) and oleic acid (C18:1). The variety of comparatively short carbon chain fatty acids were also observed that was considered to give the best fuel properties. Therefore, this local algal mixed diversity was found to be suitable for biofuel as well as various other fatty acids production.