Abstract The progress of algal-based biofuel industry depends on the identification of high lipid-yielding algal species from diverse environments. Laboratory-scale standardization of culture requirements for optimum yield of lipids and other desirable chemicals are highly important in the industrial utilization of an algal species. The major objectives of the present study were such an evaluation of the industrial potentials of a fast-growing native green microalga isolated from eutrophicated water bodies of Kerala, South India, morphologically and molecularly identified as Chloroidium saccharophilum. Biomass productivity and biochemical composition of the alga in relation to culture parameters such as total carbohydrates, proteins, pigments and lipids were learned. At an increased pH (8) or salinity (50 mM) and at a deprived nitrate (0 mM) or decreased phosphate (0.5 mM) in the medium, the alga was found producing lipids that have good biodiesel properties such as low iodine value and high cetane number. Optimum culture parameters such as pH, salinity, nitrate and phosphate conditions for maximum biomass yield of the alga are discovered. It was found that an increase in salinity or phosphates and a decrease in nitrate from that of the normal Bold's Basal Medium are favourable for an increase in omega-3 fatty acid content in the lipid.