HCCI (Homogeneous Charge Compression Ignition) combustion has the potential to significantly reduce NOx and PM emission of diesel engines due to its nature of even mixture and low temperature combustion. This combustion mode is only applicable in part load and low speed area so far. This range limitation results in frequently combustion mode switching from HCCI to CI and vice versa in real applications. HCCI realized by late injection with heavy EGR rate is investigated, which is also named PCCI (Premixed Charged Compression Ignition) sometimes. By changing control parameters (including injection timing, injection pressure and EGR rate) individually, the influences of these parameters on HCCI combustion and emissions are identified. Based on the evaluation of the influences, one pre-defined step-by-step air–fuel coordination strategy is presented. Additionally one hysteresis combustion mode determination method is proposed to avoid target mode fluctuation due to variation of engine speed or engine load in a small range. Torque deficiency occurs in acceleration transients as a result of fuel limitation to reduce soot emission, especially during HCCI to CI transitions. One ISG (Integrated Starter Generator) motor is applied to perform dynamic torque compensations in transient operations. Engine friction torque is estimated by means of cylinder pressure information from in-cylinder pressure sensors. On the basis of torque estimation, the difference between desired engine brake torque and actual engine brake torque is obtained. The torque output of ISG motor accounts for this torque gap and the torque pre distributed to ISG motor. The strategy is verified by engine tests. Experimental results indicate that, with the finely defined air–fuel coordination, less unstable combustion occurs and the target modes are established more quickly during transitions both in steady states and in transients. The torque deficiency during acceleration operations could be well compensated by the ISG motor.