The present paper reports the results of experimental investigations on the effect of diffuser vane shape on the performance of a centrifugal compressor stage. These studies were conducted on the chosen stage having a backward curved impeller of 500 mm tip diameter and 24.5 mm width and its design flow coefficient is ϕd=0.0535. Three different low solidity diffuser vane shapes namely uncambered aerofoil, constant thickness flat plate and circular arc cambered constant thickness plate were chosen as the variants for diffuser vane shape and all the three shapes have the same thickness to chord ratio (t/c=0.1). Flow coefficient, polytropic efficiency, total head coefficient, power coefficient and static pressure recovery coefficient were chosen as the parameters for evaluating the effect of diffuser vane shape on the stage performance. The results show that there is reasonable improvement in stage efficiency and total head coefficient with the use of the chosen diffuser vane shapes as compared to conventional vaneless diffuser. It is also noticed that the aero foil shaped LSD has shown better performance when compared to flat plate and circular arc profiles. The aerofoil vane shape of the diffuser blade is seen to be tolerant over a considerable range of incidence.