Reactivity controlled compression ignition (RCCI) and homogeneous charge compression ignition (HCCI) are suitable alternatives to improve the performance and emission metrics of conventional diesel combustion. Previous studies have shown that the gasoline/diesel RCCI outperforms diesel HCCI as it has a wider load range, higher brake thermal efficiency, and lower smoke and oxides of nitrogen emissions. The present work addressed the shortcomings of diesel HCCI by replacing diesel with low reactivity, high volatile methanol–gasoline blends. 2-ethylhexyl nitrate, an ignition quality improver, was added in small amounts (6 vol.%) to the blends to avoid misfiring, particularly at lower loads. There were two approaches to improve engine performance metrics of methanol–gasoline HCCI: exhaust gas recirculation and fuel composition variation. The best approach was chosen, and HCCI performed using the selected approach was compared with baseline RCCI. The methanol-gasoline HCCI was compared to baseline-optimized gasoline/diesel RCCI to demonstrate that the challenges associated with diesel HCCI can be overcome through fuel modifications. It was revealed that the strategy of varying methanol concentration in fuel blends was more effective than the strategy of varying EGR rate in terms of efficiency improvement and reduction of soot, carbon monoxide (CO) and unburned hydrocarbon (UHC) emissions. The parametric investigation showed that HCCI outperformed RCCI at mid to higher loads. For instance: at 60% load (3.19 BMEP), indicated thermal efficiency decreased by 7%, specific CO, UHC, nitrogen oxides, and smoke emissions elevated by 1.3, 1.2, 2.5, and 20.5 times for baseline-optimized RCCI than 40% methanol/54% gasoline/6% 2-EHN HCCI. Also, increased methanol in fuel during HCCI improved indicated thermal efficiency at a particular load. For instance, at 60% load, the indicated thermal efficiency improved by 30% during HCCI of fuel containing 40% methanol than 20% methanol. Overall, the present work discusses a practical method to efficiently use renewable methanol fuel in HCCI engines.