Zinc hydroxide nitrate (Zn5) is one of the layered metal hydroxide materials, which has been extensively reported as an effective bifunctional catalyst for biodiesel production from acidic oils. This report gives a comprehensive summary of the reactivity of Zn5 in the methanolysis of various oil feedstocks, plant oils, free fatty acids, and other acidic oils. Notably, as evidenced by this work, Zn5 is highly effective in converting acidic oils [palmitic acid/palm oil (PO)] to fatty acid methyl ester (FAME or biodiesel) at high yields ranging from 80 to 95%, withstanding acid content up to 10% without soap formation. The high FAME yields result from complex methanolysis and hydrolysis processes, e.g., transesterification of triglycerides in the PO, esterification of palmitic acid, and hydrolysis of the triglycerides. Despite this, Zn5 is nonrecyclable because it is unstable in the reaction media and transforms into zinc hydroxide nitrate/zinc palmitate (Zn5/ZnP) composites. The Zn5/ZnP composites were suitable for use in FAME production from PO at 100 °C for 2 h by using a methanol-to-oil molar ratio of 30:1, yielding high FAME yields of 97 and 70.7% in the first and fourth cycles, respectively. This study added better insight into how to effectively produce FAME from oil feedstocks of varying acidity by using zinc layered hydroxide- or zinc carboxylate-based materials.