To investigate the effects of hydrogen addition on the ignition characteristics and engine performance of ammonia-hydrogen fuel, a reaction kinetics mechanism suitable for high-pressure engine conditions was proposed. The study explores the influence of hydrogen blending ratios on the ignition delay time (IDT) of ammonia-hydrogen fuel, revealing the sensitive reactions and evolution characteristics of reaction pathways during the ignition process of ammonia-hydrogen fuel promoted by hydrogen. The study also investigates the impact of hydrogen blending ratios on the engine performance of ammonia-hydrogen fuel. The results show that the IDT of ammonia significantly decreases with increasing hydrogen blending ratios and temperature. The addition of hydrogen to ammonia significantly lowers the autoignition temperature boundary of the mixture. Under low-temperature and low-pressure conditions, ammonia, which would not ignite originally, ignites due to the addition of hydrogen. The addition of hydrogen shifts the sensitive reactions of the mixture from NH3 and NH2-related reactions to H2/O2-related reactions, without altering the reaction pathway of ammonia, only changing the pathway flux of components such as NH2, H2NN, H2NO, and HONO. In a spark-ignition (SI) engine, maintaining the total fuel heat value and ignition timing constant, an increase in hydrogen blending ratio significantly raises the peak cylinder pressure. However, due to the forward movement of the heat release process, the power performance of engine experiences varying degrees of reduction. Therefore, it is necessary to delay the ignition timing of engine with the increase in hydrogen blending ratio, moving the combustion center beyond the top dead center (TDC). Furthermore, increasing the hydrogen concentration in the blend significantly raises the temperature and pressure during the engine combustion process, leading to an increase in the concentration of thermal NOX in the emissions.