The conversion of biomass waste into sustainable catalysts offers a promising pathway toward green biodiesel production. In this study, a novel pelletized heterogeneous catalyst was synthesized from palm empty fruit bunch (EFB) ash through an eco-efficient pelletization process. The EFB ash, rich in potassium-based compounds, was transformed into pellets using hydraulic pressing. The material was characterized using XRD, SEM–EDX, SAA, CO₂–TPD, and TGA analyses. The physicochemical characterization revealed dominant crystalline phases of K₂CO₃, K₂O, and CaO. The catalyst also exhibited moderate basic strength and a mesoporous structure with an average pore diameter of 7.83 nm and a surface area of 0.127 m²/g. Thermogravimetric analysis confirmed the high thermal stability of the material up to 570 °C, supporting its potential as a catalyst. The catalyst exhibited a maximum biodiesel yield of 83.52% in the transesterification of refined bleached deodorized palm oil (RBDPO) with methanol at 65 °C. A catalyst loading of 12 wt% resulted in a total glycerol content of 0.1149%, which meets ASTM D6751 standards. GC–MS analysis confirmed the presence of major FAME components, including methyl palmitate, methyl oleate, and methyl linoleate. However, the catalytic activity decreased sharply after the first cycle due to potassium leaching and surface fouling, indicating limited reusability. This study demonstrates that pelletized EFB ash can serve as an efficient, thermally stable, and environmentally benign heterogeneous catalyst for sustainable biodiesel production. It also highlights the circular-economy potential of converting palm oil industry waste into high-value catalytic materials.