Due to its significant contribution to reducing pollution and crude oil use, bioethanol has been ranked as the most extensively used biofuel globally. Bioethanol was classified as a new and renewable source of fuel, which can be used as an oxygenated fuel blend for both of gasoline and diesel engines. In this work, the optimization process for bioethanol production and utilization has proceeded by Response Surface Methodology (RSM). Bioethanol production parameters such as temperature, pH, and their combined impact on bioethanol% and residual sugar have been studied. For process optimization, Box-Behnken design (BBD) based on response surface methodology (RSM) was used. For predicting bioethanol l% and residual sugar, a quadratic regression model was developed with coefficients of determination R2 of (0.9984) and (0.9883), respectively. The obtained results show that after 118.54 h, 9.33 W/V inoculum size, 31.66 °C, and 4.86 pH, bioethanol % increased to 3.5-fold to become16.92% and a minimum residual sugar concentration of 0.50 mg/ml are achieved. Also, bioethanol% and residual sugar was 16.92% and 0.50 mg/ml, respectively. However, the central composite design approach (CCD) has used to optimize the engine operating parameters were optimized to obtain the highest possible break thermal efficiency BTE% and lowest NOx emissions for a single-cylinder DI-engine running on a blend of 50% biodiesel/50% diesel combined with 10&20% bioethanol. Also, the analysis of variance was revealed by the examination of inconsistency were statistically significant. According to RSM optimizer data, the optimum NOx and BTE values were 83.72 ppm and 23.68%, respectively, at the highest concentration of bioethanol blend of 14.65% and break power of 3.21 kW.