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The catalytic transesterification of vegetable oil over heterogeneous catalysts is an effective approach for biodiesel production. To elucidate the role of MgO in catalyzing this reaction, several CaO-MgO catalysts with various Mg/Ca ratios were synthesized by co-precipitation. The catalysts were characterized by BET, XRD, SEM, HRTEM, FTIR, TGA, CO2-TPD, O2-TPO, and in situ DRIFTS. The catalytic performance in the transesterification of soybean oil with methanol was evaluated in a stirred batch reactor. The results indicated that the synthesized pure MgO had weak basic sites and poor pore structure, showing the lowest activity. The added Mg in the CaO-MgO composites was present in both doped and supported forms. The doped Mg reduced the lattice spacing of CaO, improved the intensity and number of basic sites, and enhanced the activity of catalysts, while the supported Mg hindered the diffusion of reactants to the basic sites. The amount of the doped Mg showed a maximum value due to the solubility nature of CaCO3 and MgCO3. 1Mg3Ca (Mg/Ca=1/3) exhibited the highest activity with a biodiesel yield of 92.28% at 60 °C for 2 h. CaO is sensitive to water and CO2, forming hydroxides and carbonates. The supported MgO with a low porous structure well protected the basic sites from contamination. High-temperature treatment is an effective method to remove the contaminates and the removal temperature increases in the order of H2O < Mg(OH)2 < Ca(OH)2 < CaCO3. [ABSTRACT FROM AUTHOR]