As a renewable, sustainable and alternative fuel for compression ignition engine, biodiesel instead of diesel has been increasingly became popular. Biodiesel, derived from the transesterification of vegetable oils or animal fats, is composed of saturated and unsaturated long-chain fatty acid alkyl esters. In spite of having some application problems, recently it is being considered as one of the most promising alternative fuels in internal combustion engine. The aim of the present paper is to do a comprehensive review of engine performance and emissions using biodiesel from different feedstock and to compare that with the diesel. From the review it is found that the use of biodiesel leads to the substantial reduction in PM, HC and CO emissions accompanying with the imperceptible power loss, the increase in fuel consumption and the increase in NOx emission on conventional diesel engine with no or fewer modification. However, many further researches about modification on engine, low temperature performance of engine, new instrumentation and methodology for measurements, etc., are recommended while using biodiesel as a substitute of diesel.