In this study, a modified-sawdust lubricant oil filter (MSF) was developed and its effect on emission characteristic and performance of diesel engine was studied compared with conventional fiber-paper oil filter (CPF). The tests were performed using a six-cylinder, heavy-duty direct injection diesel engine. In steady state, the brake-specific fuel consumption (BSFC), engine output power and engine oil pressure were measured at nine different typical engine speeds. Exhaust emissions of nitrogen oxides (NOx), particulate matter (PM), carbon monoxide (CO) and hydrocarbons (IIC) were analyzed according to European Steady-state Cycle (ESC). Besides, lubricant oil samples were extracted from the crankcase in the equipment of MSF and CPF individually. Then the kinematic viscosity, colloids and metal content of oil samples were determined. The results showed that MSF effectively reduced wear metal accumulation and insoluble colloids in lubricating oil, and thus retarded deterioration of oil viscosity. Compared with CPF, an increase of 2.7 kW in maximum output power and decrease of 1.66-2.85% in BSFC were observed for MSF. In addition, the using of MSF significantly reduced HC (60.9%) and PM (12.5%) emission while increased CO and NOx emission slightly. The results proved that MSF is a suitable choice for diesel engine to improve engine performance and reduce exhaust emissions.