Renewable feedstocks and high octane rating make ethanol a promising alternative fuel. In contrast to the conventional approach of applying ethanol-gasoline blends in spark-ignition engines, this study investigates the potential of ethanol fuelling in a diesel engine to achieve higher efficiency. Experiments are performed using a single-cylinder version of a common-rail diesel engine that is widely used in passenger cars. A dual-fuelling technology is implemented such that ethanol is introduced in to the intake manifold using a port-fuel injector while diesel is injected directly into the cylinder. The main focus is the effect of ethanol energy fraction and diesel injection timing on engine efficiency and tailpipe emissions. While these two parameters are varied, in-cylinder pressure measurement and subsequent analysis of indicated mean effective pressure, apparent heat release rate, ignition delay, combustion phasing, and burn duration are performed. From the ethanol energy variation tests at fixed diesel injection timing, it is found that increased ethanol energy fraction increases the engine efficiency until the operation is limited by misfiring associated with over-retarded combustion phasing. By energy fraction, up to 60% of diesel is replaced by ethanol, which achieves 10% efficiency gain compared with diesel-only operation. Detailed analysis of the results reveals that the decreased burn duration is the primary cause for the efficiency gain, i.e. the fast burning of ethanol improves the combustion. However, the burn duration appears to increase with advancing the diesel injection timing at a fixed ethanol energy ratio despite the fact that the highest indicated mean effective pressure of 1020 kPa is measured when the diesel injection timing is set at eight crank angle degrees before top dead centre, the most advanced diesel injection timing of this study. This is due to optimised combustion phasing such that the main heat release occurs near top dead centre, which outperforms the increased burn duration. Therefore, both burn duration and combustion phasing should be considered to explain trends in the indicated mean effective pressure or efficiency of dual-fuel combustion engines. The tailpipe emissions suggest that unburnt hydrocarbon, carbon monoxide and NOx emissions increase with increasing ethanol fraction, which raises a question on the advantages of utilising ethanol in a diesel engine. However, negligible smoke emissions are measured at ethanol energy ratio of 20% or higher suggesting that optimisation of these emissions would be much easier compared with conventional diesel combustion. (C) 2013 Elsevier Ltd. All rights reserved.