The current research work experimentally studied four strokes, single cylinder, eddy current dynamometer water cooled, variable compression ratio, diesel engine. The biodiesel derived from the cottonseed oil by the well-known transesterification process. The biodiesel-diesel blends B20 (0.8%diesel + 0.2% biodiesel), B50 (0.5diesel + 0.5%biodiesel) were mixed with aluminium oxide nanoparticles in different proportions of 50 ppm and 100 ppm by using ultrasonication process. The investigation carried out at constant speed of 1500 rpm and constant compression ratio of 18:1. The brake thermal efficiency (BTE), brake specific fuel consumption (BSFC), CO2 and NOx, CO and HC Harmful gases were measured and collated to diesel fuel. It is observed that B20ANP100ppm blend provides desirable results in Emissions and performance characteristics compared to diesel. Improvement in brake thermal efficiency observed with B20ANP100ppm compared to diesel and brake specific fuel consumption of B20ANP100ppm slightly increased compared to diesel. CO, HC&CO2 emissions reduced by using cottonseed blends compared to diesel and small amount of NOx increased compared to diesel.