The present invention relates to a method for reducing free fatty acid content in acidic plant-derived oil using homogenous sulfonic acid catalyst, comprising esterifying and transesterifying the acidic plant-derived oil, and characterized by the steps of: heating the acidic plant-derived oil; esterifying the heated acidic oil with an alcohol having 1-4 carbon chain length at a molar ratio of the alcohol to heated oil of 1-10:1, in the presence of liquid sui phonic acid catalyst such as ethanesulfonic acid, trifluoromethanesulfonic acid or any combination thereof to form a mixture, wherein the liquid sulphonic acid catalyst is at a weight of 0.25 - 3.5% by weight of the total weight of the acidic plant-derived oil; heating said mixture at a temperature in a range of 40-70 ?C a period of 3-150 minutes to produce an esterified oil having free fatty acids content of maximum 1 % by weight; evaporating the alcohol having 1-4 carbon chain length and separating the liquid sulphonic acid catalyst from the esterified oil, wherein the liquid sulphonic acid catalyst is recycled for esterifying a fresh heated acidic oil; reacting the esterified oil with an alkali catalyst and the alcohol having 1-4 carbon chain length to form the treated oil containing fatty acid alkyl ester, unreacted alcohol having 1-4 carbon chain length and crude glycerol; evaporating the unreacted alcohol and separating the crude glycerol; and purifying the treated oil with water and dehydrating said purified oil to obtain fatty acid alkyl ester. Drawing accompanying abstract: Fig. 1