Consumption of the fossil fuel increases in proportion to energy demands all over the world as well as in the Republic of Mozambique. The Biofuels produced from Jatropha seeds attracts attention as alternative fuel compared to fossil fuel. Studies of the biodiesel production, the engine performance and exhaust emission with Jatropha extracted oil used as the fuel for diesel engine were conducted. Jatropha seeds preheated at temperature range of 80 ¿ 90 ºC produced high percentage of oil extracted (22.5%) with low acid value (21.38 mg KOH/g). The extracted oil was submitted to the process of degumming, neutralization and transesterification with conversation rates of 96%, 80.1% and 90%, respectively. This has led to yield of 66% of biodiesel. A direct injection diesel engine generator (YDL 4200, 4.5 kW, 3000 rpm) was used as the test en- gine. The biodiesel was used as the test fuel and was mixed with diesel fuel for different mixture ratio of 5 ¿ 100%. The desirable mixture ratio of bio- diesel 5 ¿ 20% was obtained from the point view of the better exhaust emissions which was lower compared to diesel fuel.