Due to safety, economy and other considerations, Heavy Fuel Aviation Piston Engines (HF-APES) powered by light diesel or aviation kerosene with high ignition point were expected to replace aviation gasoline engines. The present study compared the combustion characteristics of diesel, aviation kerosene rocket propellant 3 (RP-3) and RP-3/ethanol blends in a four-cylinder Turbo Diesel Common-rail Injection (TDCI) engine. The results demonstrated, compared with diesel, RP-3 had similar combustion performance at maximum torque speed and medium speed. The maximum in-cylinder pressure and temperature are almost the same. RP-3 can be applied to compression ignition engines and can replace diesel in civil and military aviation. The addition of ethanol could improve the overall combustion performance and increase the combustion stability of aviation kerosene in diesel engines, effectively solved the combustion deterioration of RP-3 under medium speed and low load (when indicated mean effective pressure (IMEP) was 0.24 MPa, the peak pressure in the cylinder of E20 was 10.5% higher than E0, and the second-stage maximum heat release rate was 2.9 times that of E0). Compared with diesel, the equivalent specific fuel consumption (ESFC) of RP-3 was lower under most working conditions. After adding ethanol to RP-3, the ESFC was increased by 2.0–9.1%; RP-3 showed higher indicated thermal efficiency (ITE) than diesel by 7.7–8.2%.