In the present study, a reverse-loop scavenged poppet-valve 2-stroke (PV2S) diesel engine was developed and compared with its 4-stroke baseline experimentally. Firstly, the valve cam profiles and the valve timings for the PV2S engine was optimized using 1D simulations. Results show that, the present intake and exhaust cam profiles meet the design requirements under a series of designing allowances. The nonlinear relationship between the gas exchange performance and the power output for the PV2S engine is due to the fact that the expansion work loss increases more than the volume efficiency improvement with the exhaust valve closure timing changes from 95 °CA to 85 °CA. Then, the in-cylinder flow of the new designed upright-strait ports and masked head was simulated using 3D simulations in comparison with the original horizontal head. It is found that the upright-strait intake port can induce intense reverse tumble in-cylinder flow to make an effective gas exchange than the under 2-stroke mode. Finally, the performances of the new developed PV2S engine and the its 4-stroke baseline are compared on the single-cylinder engine test bench. Experimental results show that the brake specific fuel consumption of the PV2S engine is higher than that of the 4-stroke engine under same engine speed and same power output conditions because of the decreased thermal efficiency and the increased friction loss proportions. However, the PV2S engine shows a better economic performance than the 4-stroke engine at rated conditions due to the reduced friction losses from down-speeding.