A comparative study of lipase enzyme yields by solid state fermentation (SSF) and submerged fermentation (SmF) was performed here. Three fungal colonies were isolated from biopharmaceutical oil waste collected from "Oushadhi" (The Pharmaceutical Corporation (IM) Kerala Ltd). The pure colonies were then used as inoculums for solid state and submerged fermentation of lipase. Strains were identified as Aspergillus sp., Trichoderma sp. and Penicillium sp. The oil waste itself was used as a substrate for SSF and it was supplemented with ((NH4)2SO4 5.0 g/l; Na 2HPO4 6.0 g/l; KH2PO4 2.0 g/l; MgSO4.7H2O 3.0 g/l and CaCl2 3.0 g/l) at pH 6. The composition of production media (pH 6) used for SmF was glucose-10, peptone-20, NaCl-5 and yeast extract-5 (g/l).The comparison of enzyme yields showed that the yield in SSF was higher than that of SmF in most cases. Out of the three fungal strains, lipase produced by Aspergillus sp. showed the highest enzyme activity on assay by olive oil substrate emulsion method. © 2009 Academic Journals.