In order to optimize air-fuel mixture formation in a small DI diesel engine, studies were conducted into the effects of combustion chamber shape and fuel spray impingement. Based on the findings of these studies, the shape of the combustion chamber was modified to induce complex air motion with high turbulence and fuel injection was carefully controlled to achieve optimum impingement intensity. As a result, the mixture formation process was greatly improved with a consequent gain in terms of engine performance. To clarify the reasons for this improvement in combustion, a three-dimensional calculation of the in-cylinder air motion was made. The behaviour of the spray and flame was observed using an endoscope.The new combustion system, named TOYOTA Reflex Burn system (TRB) thus developed has been adopted in production engines since August 1988.