In this study, the possibility of biodiesel fuel and oxygenated fuel(dimethoxy methane, DMM) was investigated as an alternative fuel for a naturally aspirated direct injection diesel engine. The smoke emission of blending fuel (diesel fuel 90vol-% + DMM 10vol-%) was reduced approximately 70% at 2500rpm, full load in comparison with the diesel fuel. Engine power and brake specific energy consumption showed no significant differences. But, NOx emission of biodiesel fuel and DMM blended fuel increased compared with commercial diesel fuel due to the oxygen component in the fuel. It was needed a NOx reduction counter plan that EGR method was used as a countermeasure for NOx reduction. It was found that simultaneous reduction of smoke and NOx emission was achieved with diesel fuel (95 vol-%) and DMM (5 vol-%) blended fuel and cooled EGR method (15%).