Reduction in NOx in light and medium duty diesel engines, without the requirement for Catalyst Converter or Exhaust Gas Recirculation (EGR) and meeting the U.S. emission standards is an important challenge. This paper shows how injection rate shaping should be performed to reduce NOx while engine performance and soot formation remain almost constant. Effects of intercooler with and without rate shaping on NOx reduction will be investigated. Results indicated that the rate shaping was an effective technique to reduce NOx at some operating condition. Combined effects of intercooler and rate shaping have shown a reduction of NOx by 50% for some operating conditions. At idle condition a split injection was found to be a good solution for NOx reduction. A combustion-simulation computer program was used in this analysis for six different operating conditions.