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Using methanol to replace the diesel fuel in diesel engine is a simple way in using of alternative fuel. But the main problems are that the max. cylinder pressure and the cylinder pressure rising will be increased. This increases the mechanical load engine noise and affects the engine reliability. Also limits increasing the ratio of methanol to diesel fuel. This paper presents an new way of using EGR to control the cylinder pressure and to raise the ratio of methanol to diesel fuel. There are many ways to burn methanol in diesel engines. Generally, the liquid methanol is vaporized by heating of exhaust pipe or and cooling water, then it mixes with air through intake pipe, finally, burns in the cylinder. The advantages of this method are that the structure of diesel engine needs no change. By using the exhaust heat to vaporize the liquid methanol, the wasted heat can be utilized again. So it is helpful to improve the thermal efficiency. However, there are some shortages.