Amino acid anion based ionic liquids (ILs) in combination with tetrabutylammonium cation were synthesized and their ability to act as effective phase forming components in aqueous biphasic systems (ABS) was studied. The natural and eco-friendly amino acids have been selected as sources of anions in ILs in order to propose biocompatible ABS. The phase formation ability of synthesized ILs was evaluated in combination with potassium salts of appreciable salting-out ability at 298.15 K and atmospheric pressure. The phase behavioral trends of proposed systems were analyzed based on structural variation of anions of ILs. The selected amino acids vary with respect to their functional groups and the effect of these groups on phase formation was systematically evaluated through their phase diagrams. The significant role played by inorganic salts as other phase forming component also has been determined. Further in the order to understand the effect of external factor like temperature, we determined phase diagrams of selected systems at 318.15 and 328.15 K in addition to 298.15 K. To evaluate the application of the suggested ABS for extracting value added compounds, we determined their partition behavior by selecting caffeine as model alkaloid and UV visible spectral technique was employed for this purpose. The amino acid anions of ILs apart from making the proposed ABS bio compatible proved to be efficient phase forming components and could effectively extract caffeine in single step. © 2019 Elsevier B.V.