Lipid accumulation abilities of two endophytic fungal isolates - Colletotrichum sp. and Alternaria sp. grown under optimum and nutrient-stress conditions were investigated and compared. Significant variations in lipid contents, ranging from 30% to 58% of their dry biomass were found in liquid culture using various carbon sources. Since, >50% of the total lipid was estimated to be neutral lipid for both the fungal species, predicted biodiesel properties were theoretically calculated based upon the determined fatty acid profiles; and the values were found to be comparable to those of commonly used plant oils for biodiesel production. The two endophytes grew successfully on the combined rice straw and wheat bran as substrate that was degraded by their secretory enzymes including cellulase [1.21-2.51 FPU/g dry substrate (gds)] in solid state fermentation and produced substantial amount of lipid (60.32-84.30 mg/gds). Our study highlights the potential utilities of these two novel endophytic fungi as biodiesel feedstock.