Biodiesel is one kind of renewable fuel produced from biomass oil. To optimize the application of biodiesel on vehicle diesel engines, we conducted the tests on a four cylinder turbocharged direct injection (DI) diesel engine fuelled with biodiesel-diesel blends of different ratios, measured their power outputs, fuel consumption and emissions, and compared with those of diesel fuel. Experimental results show that fuelled with biodiesel, at external characteristics (speed characteristics of full load), the power performance is almost the same, brake specific energy consumption (BSEC) decreases, smoke and HC emissions decrease, and NOx and CO emissions increase; at load characteristics, BSEC decreases, smoke emission decreases at high loads and keeps almost no change at low and middle loads, NOx emission increases, HC emission decreases at low and middle loads and keeps the same at high loads, and CO emission maintains the same. B20 (biodiesel content of 20%) is an optimum solution for vehicle engines under comprehensive analysis of performances and emissions.