The use of alternative fuels in internal combustion engines has significantly increased due to their promising characteristics. Many researchers use computational analysis, a reliable technique that provides accurate results comparable to experimental findings, to analyse engine performance, combustion, and emission characteristics. The cost of converting feedstock into biodiesel ranges from 70% to 95%. Garcinia Gummi-Gutta (GGG) is a commercially valuable spice tree that helps reduce biodiesel production costs, generating Rs. 82,666 annually for farmers. The oil yield from GGG seeds was 18% for boiling, 23% for mechanical expeller, and 42% for solvent extraction methods, with physical properties meeting ASTM biodiesel standards. The crude oil from GGG seeds had a free fatty acid content of 33.56%, necessitating esterification followed by transesterification. GC-MS and FTIR analyses confirmed biodiesel conversion and the design of experiments (DOE) explored process kinetics, resulting in 96.2% biodiesel yield under optimized transesterification conditions using teacher-learner-based optimization (TLBO). The addition of silver oxide nanoparticles increased biodiesel yield to 97.8%, maintaining 90.1% after six reuse cycles. The estimated cost of biodiesel conversion is $0.8393. Three biofuel type blends (B10, B20, and B30) were prepared for use, with computed overall uncertainty in experiments of ±3.15%. The experiments were conducted with four varying variables: engine load (EL), BT, injection pressure (IP), and compression ratio (CR). The researchers evaluated the performance (brake thermal efficiency: BTE, and brake-specific fuel consumption: BSFC) as well as the emissions (carbon monoxide: CO, nitrogen oxide: NOx, unburnt hydrocarbon: UHC) characteristics. The models developed for emission and performance characteristics showed a high coefficient of determination, indicating their statistical adequacy for prediction and optimization.