An active heterogeneous catalyst of the type K y Mg 1−x Zn 1+x O 3 that separates easily from an ester product mixture has been developed. The catalytic efficiency was studied with the transesterification of palm oil into fatty acid methyl esters. The catalyst was thermally treated at 461°C for 4h. A typical K 2 Mg 0.34 Zn 1.66 O 3 oxide was characterized with powder X-ray diffraction and infrared Fourier transform, and its microstructure was studied by the use of scanning electron microscopy. The properties studied provided insight into the catalytic performance of the catalyst. The optimum conditions were obtained by varying parameters such as methanol to oil ratio, catalyst loading, temperature and time. The highest ester conversion of 87% was achieved under atmospheric pressure in 5h at 188°C using 64g of refined palm oil, 38g of methanol and 2.3wt% catalyst dosage. The results showed that a synergetic effect of active components was responsible for its high activity.