Due to the poor physical properties of raw bio-oil from pyrolysis, in this work reactive distillation was used to upgrade vaporized bio-oil from selected co-pyrolysis of palm kernel shell and palm empty fruit bunches at 75%/25% mixing ratio by using 10%Ni/HZSM-5 catalyst and ethanol at various reboiler temperatures. In the pyrolysis process, the feed temperature (biooil vapor and non-condensable gas) was in the range between 35 and 230 °C. The reboiler temperature not only influenced the separation of heavy oil from raw bio-oil, which would help minimize catalyst deactivation, but also possibly affected contact time of reactants with catalyst via the residence time. The vaporized bio-oil was upgraded by esterification and acetalization reactions producing levulinic acid ethyl ester, nonanoic acid ethyl ester, and 1,1-diethoxyethane. The physical characteristics density, kinematic viscosity, water content, and pH were improved from those of the raw bio-oil.