In Greater Metropolitan Sao Paulo, Brazil, fossil fuel combustion in the transportation system is a major cause of outdoor air pollution. Air quality improvement requires additional policies and technological upgrades in fuels and vehicle engines. The current study thus simulated the environmental and social impacts resulting from the use of a stabilized diesel/ethanol mixture in the bus and truck fleet in Greater Metropolitan Sao Paulo. The evaluation showed reductions in air pollutants, mainly PM10, which would help avert a number of disease events and deaths, as estimated through dose-response functions of epidemiological studies on respiratory and cardiovascular diseases. Valuation of the impacts using an environmental cost-benefit analysis considered operational installation, job generation, potential carbon credits, and health costs, with an overall positive balance of US$ 2.851 million. Adding the estimated qualitative benefits to the quantitative ones, the project's benefits far outweigh the measured costs. Greater Metropolitan Sao Paulo would benefit from any form of biodiesel use, producing environmental, health and socioeconomic gains, the three pillars of sustainability.