The HCCI engine offers the potential of low NOx emissions combined with diesel engine like high efficiency, however HCCI operation is restricted to low engine speeds and torques constrained by narrow noise (HCCI knocking) and misfiring limits. Gasoline like fuel vaporizes and mixes with air, but the mixture may auto-ignite at the same time, leading to heavy HCCI knocking. Retarding the CA50 (the crank angle of the 50% burn) is well known as a method to slow the maximum pressure rise rate and reduce HCCI knocking. The CA50 can be controlled by the fuel composition, for example, di-methyl ether (DME), which is easily synthesized from natural gas, has strong low temperature heat release (LTHR) characteristics and ethanol generates strong LTHR inhibitor effects. The utilization of DME-ethanol binary blended fuels has the potential to broaden the HCCI engine load-speed range. Further, extending the high temperature heat release (HTHR) combustion period by exhaust gas recirculation (EGR) is an effective method for slowing the maximum pressure rise rate and reducing HCCI knocking. In this paper, DME and ethanol binary fuels were used in a four cycle single cylinder HCCI engine, and the oxygen contents of the injected fuels were changed by the EGR ratio. From the heat release and emissions data, the effects of fuel composition and EGR on the HCCI operational range were evaluated.