An in-fuel-line mechanical emulsification has been developed at Ontario Research (the ORF HydroShear) which is compatible with installation in the fuel system of both light duty and heavy duty diesel engines. The HydroShear has been used to prepare both water/diesel and methanol/diesel emulsions having particle sizes of a few microns and with sufficient stability to be used in unstabilized form in the fuel management system of diesel engines. The installation of the HydroShear on 97 and 149 kW diesel engines is described, together with its mode of operation.A comparative study of water/diesel fuel emulsions applied to both two and four stroke cycle diesel engines has shown exhaust emissions and engine performance to be sensitive to the general engine design employed. Greatest benefits were achieved with the four-stroke engine. Particulate and NOx emissions were reduced by up to 50%.Testing HydroShear capability to fuel engines with methanol/diesel emulsions has indicated that methanol can be used as a diesel fuel extender with this technique. Total particulate emissions were reduced 50%, with carbon black being reduced by 75%.