This paper presents the concept of gasified diesel fuel as a potential solution to the diesel engine emissions problem, especially the particulates. The concept employs two-stage combustion. During the first stage of combustion diesel fuel is partially oxidized with air in a catalytic reactor and converted to a hydrogen-rich gas. During the second stage of combustion the hydrogen-rich gas is mixed with additional air and burned to completion in the engine. The first stage reaction is catalytic and when carried out at an air-fuel mass ratio of 5.2, it does not produce soot or particulates. The subsequent combustion of the hydrogen-rich gas in the engine does not form soot or particulates.The conversion of diesel fuel to a hydrogen-rich gas is an exothermic reaction. The energy released during the process can be recovered in a Rankine engine heat recovery unit to prevent a net loss in fuel economy. The heat recovery unit can also be used to recover the engine exhaust heat to improve overall system efficiency. Results of the analysis indicate up to 10 percent improvement in overall system efficiency over conventional diesel engines. Experiments on a catalytic gasifier show that complete gasification of diesel fuel is possible without soot or particulate formation.Implementation of the concept requires additional equipment and appropriate controls which represents increased cost and complexity.