Used cooking oil (UCO) is a domestic waste generated daily by food industries, restaurants, and households. It is estimated that in Europe 5 kg of UCO are generated per inhabitant, totalling 2.5 million metric tons per year. Recovering UCO for the production of biodiesel offers a way of minimizing and avoiding this waste and related pollution. An exergy analysis of the integrated waste management (IWM) scheme for UCO is used to evaluate such a possibility by accounting for inputs and outputs in each stage, calculating the exergy loss and the resource input, and quantifying the possible improvements. The IWM includes the collection, pretreatment, and delivery of UCO and the production of biodiesel. The results show that the greatest exergy loss occurs during the transport stages (57%). Such exergy loss can be minimized to 20% by exploiting the full capacity of collecting vans and using biodiesel in the transport stages. Further, the cumulative exergy consumption helps study how the exergy consumption of biodiesel can be further reduced by using methanol obtained from biogas in the transesterification stage. Finally, the paper discusses how increasing the collection of UCO helps minimize uncontrolled used oil disposal and consequently provides a sustainable process for biodiesel production. © 2008 American Chemical Society.