Diesel fuel emulsions have demonstrated reductions of unwanted combustion emissions. Glycerol, a renewable and abundant resource, is an attractive fuel component because it is a low-cost energy source. In this paper, the glycerol-diesel emulsion system is characterized and resultant fuel properties are presented. Surface analytical techniques and long-term stability evaluations are used to identify optimal surfactant composition. Emulsions are prepared using batch ultrasonic processing to produce a narrow droplet size distribution with a mean of approximately 3.3 mu m. The glycerol water content tends to increase the droplet size distribution. Glycerol-diesel emulsions prepared at 10 and 20 vol % glycerol phase are combusted in a naturally aspirated single-cylinder diesel engine. Oxides of nitrogen and particulate matter emissions are reduced by 5-15 and 25-50%, respectively. Indicated fuel consumption is increased corresponding to an increased glycerol concentration because of a reduction in the emulsion energy density. Thermal efficiency improvements are observed at high loads.