Lipase catalyzes the hydrolysis of glycerides into fatty acids and glycerol. The study of microbial lipases has been stimulated in resent years. It is due to the potential uses of lipases in esterification of oils to glycerol, alcohols and carbohydrates. Development of lipase producing yeast has been focused concerning to the utilization of yeast culture for animal feed. In this study, yeast like cells was isolated from a waste oil and sludge. A strain having higher lipase activity was selected by random mutagenesis using UV-radiation. The optimal cultivation conditions in submerged culture were examined in terms of lipase production. 2.0％ of high fructose syrup, 1,0％ of CSL, and 1.0％ of olive oil were selected as the nutritional media for the production of lipase. The maximum lipase activity of 1.12 U/ml and viable cell number of 8.8${ imes}$10$^$7/ cells/mL were obtained at 27$^{circ}C$ with an initial pH of 5.0.