Combustion, performance, and emission were studied for a direct-injection (DI) diesel engine fueled with dimethoxymethane (DMM)/diesel blends, with DMM content from 0 to 50%. Results showed that, without changing the fuel supply system and the combustion system of a diesel engine, when using blended fuel with increased DMM percentage, break-specific fuel consumption (BSFC) is higher for a smaller lower heating value of DMM, while thermal efficiency increases a little. For exhaust emission, smoke and CO emission decrease and NO., remains almost unchanged, while hydrocarbons (HCs) increase. For combustion characteristics, peak pressure and pressure rise become slightly higher, ignition delay is longer, which means more and faster premixed combustion, and the diffusion combustion is faster because of oxygenated fuel. The diesel engine fueled with 30% DMM blending fuel can obtain satisfactory fuel efficiency and emission level.