Biodiesel has emerged as a sustainable renewable energy option and a promising substitute for traditional fossil fuel-derived petroleum. However, its current industrial production is financially impractical requiring novel approaches to ensure sustainability and commercial viability. Carbon dots (CDs) have recently been reported as promising heterogeneous catalysts for transesterification of oil to biodiesel yet the role of the surface chemistry remains vaguely understood. Here, we present amine-passivated CDs (N-CDs) as a model in which their surface chemistry, namely the degree of carboxylic acid to amine and amide functionalization, can be controlled by modifying the amine passivating agent. We thoroughly investigated the N-CDs physico-chemical properties and applied them as heterogeneous catalysts to transesterify canola oil to biodiesel. We report biodiesel conversions of ≥97% using 1 wt% catalyst loading at 100 °C for 3 hours even when the catalyst is reused for five reaction cycles. Lastly, we investigate the effects of modifying the carbon dot surface groups and postulate a plausible governing mechanism for the N-CD-catalyzed transesterification of canola oil to biodiesel. Our findings suggest that both carboxylic acids and amines can act as active catalytic sites, and depending on their concentration, two different reaction mechanisms are possible.