Background: Single cell oils (SCOs) accumulated by oleaginous fungi have emerged as a potential alternative feedstock for biodiesel production. Though fungi from mangrove ecosystem have been reported for production of several lignocellulolytic enzymes, they remain unexplored for their SCO producing ability. Thus, these oleaginous fungi from the mangrove ecosystem could be suitable candidates for production of SCOs from lignocellulosic biomass. The accumulation of lipids being species specific, strain selection is critical and therefore, it is of importance to evaluate the fungal diversity of mangrove wetlands. The whole cells of these fungi were investigated with respect to oleaginicity, cell mass, lipid content, fatty acid methyl ester profiles and physicochemical properties of transesterified SCOs in order to explore their potential for biodiesel production. Results: In the present study, 14 yeasts and filamentous fungi were isolated from the detritus based mangrove wetlands along the Indian west coast. Nile red staining revealed that lipid bodies were present in 5 of the 14 fungal isolates. Lipid extraction showed that these fungi were able to accumulate > 20\% (w/w) of their dry cell mass (4.14 - 6.44 gL(-1)) as lipids with neutral lipid as the major fraction. The profile of transesterified SCOs revealed a high content of saturated and monounsaturated fatty acids i.e., palmitic (C16:0), stearic (C18:0) and oleic (C18:1) acids similar to conventional vegetable oils used for biodiesel production. The experimentally determined and predicted biodiesel properties for 3 fungal isolates correlated well with the specified standards. Isolate IBB M1, with the highest SCO yield and containing high amounts of saturated and monounsaturated fatty acid was identified as Aspergillus terreus using morphotaxonomic study and 18 S rRNA gene sequencing. Batch flask cultures with varying initial glucose concentration revealed that maximal cell biomass and lipid content were obtained at 30gL(-1). The strain was able to utilize cheap renewable substrates viz., sugarcane bagasse, grape stalk, groundnut shells and cheese whey for SCO production. Conclusion: Our study suggests that SCOs of oleaginous fungi from the mangrove wetlands of the Indian west coast could be used as a potential feedstock for biodiesel production with Aspergillus terreus IBB M1 as a promising candidate.