We used four strains (Y1, Y2, M1 and M2) to screen out the high lipid production strains. We first adopted cell morphology and cytochemical methods (Sudan III dyeing technique) to observe intracellular characteristics. Observation results indicated that M2 strain had the potential lipid accumulation capacity. To prove this, lipid content of these strains was determined by soxhlet extraction. One strain (M2) was found to produce lipids up to 53.09%. In order to increase the production of oleaginous microorganism, the effects of hydrolysate concentration, nitrogen source, pH, fermentation temperature and time on cell growth and lipid accumulation were studied. The optimal fermentation conditions were obtained as follows: corn starch byproduct hydrolysate concentration at 10°Bx as carbon source; NaNO3 as nitrogen source at 0.2%; initial pH of 6.0; temperature at 28oC, cultivated for 6 d. Under these conditions, M2 strain accumulated lipids up to 75.21% on a cellular biomass basis with biomass yield of 30.40 g/L, and the corresponding lipid production reached 22.86 g/L. GC analysis demonstrated that the fatty acid composition of the lipid was similar to that of vegetable oil, which mainly contained 16-and 18-carbon fatty acids. Thus, microbial lipid is a promising material for biodiesel production, and its unsaturated fatty acid content reached around 68%. These unsaturated fatty acids show great potential applications in food, medicine and cosmetics industries.