In recent years, the number of automobiles has drastically increased. As a result, the need for energy in the transportation sector is continuously rising. Additionally, using fossil fuels results in many hydrocarbon emissions, carbon monoxide, carbon dioxide, and particulate matter, spoiling the environment. Renewable energy sources like solar power, biodiesel, wind turbine, bioethanol, methanol, hydrogen, and various biomasses from wastes become a great subject of interest. This paper includes biodiesel production from Nahar oil with two-step transesterification and the performance and exhaust emission in a four-cylinder diesel engine fueled with double-walled carbon nanotubes blended with Nahar oil biodiesel. In this case, the B30 blend of Nahar oil biodiesel is taken as base fuel and different proportionate carbon nanotubes blends are compared with pure diesel. The performance analysis is done in a multi-cylinder test engine setup, and the emission of different exhaust gases is considered. The outcomes from the tests demonstrate that Nahar oil biodiesel and its mixes with carbon nanotubes can substitute diesel engines in the future when nonrenewable energy source stores become compromised.