In this work, the effect of water-oil emulsions on the engine performance and on the main pollutant emissions, NOx, total hydrocarbons (THC), soot, particulate matter (PM) and its composition, was studied. A turbocharger intercooler indirect injection (IDI) Diesel engine was tested under five different steady state operating conditions, selected from the transient cycle for light duty vehicles established in the European Emission Directive 70/220. Tests were performed using a commercial fuel as a reference and an emulsified fuel for each operating condition. Results reported here suggest that the water emulsification has a potential to slightly improve the brake efficiency and to significantly reduce the formation of thermal NO, soot, hydrocarbons and PM in the Diesel engine. (c) 2004 Elsevier Ltd. All rights reserved.