THE INFLUENCES OF DIFFERENT DIESEL/BIODIESEL MIXTURES AND EGR RATES ON BRAKE SPECIFIC FUEL CONSUMPTION (BSFC), EXHAUST GAS TEMPERATURE AND NO, HC, CO EMISSIONS, IS STUDIED AND DEMONSTRATED. IN THIS PAPER, FOUR STROKES DIRECT INJECTION WATER COOLED DIESEL ENGINE WAS USED. THE COMBUSTION OF BIODIESEL AS AN ABSOLUTE FUEL OR MIXED WITH DIESEL IN AN UNCHANGED ENGINE CONSEQUENCES IN ADVANCED COMBUSTION, DECREASED IGNITION DELAY AND IMPROVED HEAT RELEASE RATE IN THE INITIAL UNCONTROLLED PREMIXED COMBUSTION PHASE THAT CAUSED, HIGHER CYLINDER PEAK PRESSURE AND TEMPERATURE THAT RESULT INCREASED NO. EXHAUST GAS RECIRCULATION (EGR) IS AN IMPRESSIVE TECHNIQUE FOR DECREASING NO EMISSIONS WHEN UTILIZING BIODIESEL-DIESEL FUEL MIXTURES. REDUCTIONS IN NO AND EXHAUST GAS TEMPERATURE WERE OBSERVED BUT EMISSIONS OF HC AND CO WERE FOUND TO HAVE INCREASED WITH USAGE OF EGR. THE ENGINE PERFORMANCE AND EFFICIENCY OBTAINED IN BIODIESEL CASE WERE LESS, WHICH COULD BE ATTRIBUTED TO LOWER CALORIFIC VALUE OF BIODIESEL. THE INCREASED OF BSFC OBTAINED WITH BIODIESEL ARE LOWER THAN THAT OF DIESEL FUEL WHEN APPLYING SAME EGR RATE. THUS, EGR HAS A LOWER NEGATIVE INFLUENCE ON ENGINE PERFORMANCE IN CASE OF BIODIESEL COMPARED TO DIESEL FUEL.