Abstract The investigation was conducted on a high-speed direct injection diesel engine and was concerned with the effects of exhaust gas recirculation (EGR) on diesel engine combustion and emissions. In particular, the effects of carbon dioxide (CO2), a principal constituent of EGR, on combustion and emissions were analysed and quantified experimentally. The use of CO2 to displace oxygen (O2) in the inlet air resulted in: reduction in the O2 supplied to the engine (dilution effect), increased inlet charge thermal capacity (thermal effect), and, potentially, participation of the CO2 in the combustion process (chemical effect). In a separate series of tests the temperature of the engine inlet charge was raised gradually in order to simulate the effect of mixing hot EGR with engine inlet air. Finally, tests were carried out during which the CO2 added to the engine air flow increased the charge mass flowrate to the engine, rather than displacing some of the O2 in the inlet air. It was found that when CO2 displaced O2 in the inlet charge, both the chemical and thermal effects on exhaust emissions were small. However, the dilution effect was substantial, and resulted in very large reductions in exhaust oxides of nitrogen (NO x ) at the expense of higher particulate and unburned hydrocarbon (uHC) emissions. Higher inlet charge temperature increased exhaust NO x and particulate emissions, but reduced uHC emissions. Finally, when CO2 was additional to the inlet air charge (rather than displacing O2), large reductions in NOx were recorded with little increase in particulate emissions.