In order to realize a premixed compression ignition (PCI) engine, the effects of bioethanol-gas oil blends and exhaust gas recirculation (EGR) on PM-NOx trade-off have been investigated focusing on ignition delay, premixed combustion, diffusion combustion, smoke, NOx and thermal efficiency. The present experiment was done by increasing the ethanol blend ratio and ethanol and by increasing the EGR ratio in a single cylinder direct injection diesel engine. It is found that a remarkable improvement in PM-NOx trade-off can be achieved by promoting the premixing based on the ethanol blend fuel having low evaporation temperature, large latent heat and low cetane number as well, in addition, based on a marked elongation of ignition delay due to the low cetane number fuel and the low oxygen intake charge. As a result, very low levels of NOx and PM, which satisfies the 2009 emission standards imposed on heavy duty diesel engines in japan, were achieved without deterioration of brake thermal efficiency in the PCI engine fuelled with the 50% ethanol blend diesel fuel and the high EGR ratio. It is noticed that smoke can be reduced even by increasing the EGR ratio under the highly premixed condition. (C) 2010 Elsevier Ltd. All rights reserved.