An approach to include droplet size effects in a two-fluid model for Diesel sprays when the locally-homogeneous flow (LHF) assumption is employed is developed. The model is then employed to study the effect of droplet sizes on the steady liquid penetration in vaporizing Diesel sprays when several injection and chamber parameters are changed. These parameters include the orifice diameter, injection pressure, ambient temperature and the ambient density. The computed steady liquid penetration is compared with constant volume measurements made under Diesel conditions at the Sandia National Laboratories. It appears that under typical Diesel conditions, the steady liquid penetration is controlled by entrainment and mixing alone. However, at lower ambient densities, droplet sizes may also be important.