A detailed review was conducted to explore waste cooking oil (WCO) as feedstock for biodiesel. The manuscript highlights the impact on health while using used cooking oil and the scope for revenue generation from WCO. Up to a 20% blend with diesel results in less pollutants, and it does not demand more modifications to the engine. Also, this reduces the country’s import bill. Furthermore, it suggests the scope for alternate sustainable income among rural farmers through a circular economy. Various collection strategies are discussed, a SWOC (strength, weakness, opportunity, and challenges) analysis is presented to aid in understanding different countries’ policies regarding the collection of WCO, and a more suitable method for conversion is pronounced. A techno-economic analysis is presented to explore the viability of producing 1 litre of biodiesel. The cost of 1 litre of WCO-based biodiesel is compared with costs Iran and Pakistan, and it is noticed that the difference among them is less than 1%. Life cycle assessment (LCA) is mandatory to reveal the impact of WCO biodiesel on socio-economic and environmental concerns. Including exergy analysis will provide comprehensive information about the production and justification of WCO as a biodiesel.