Problem statement: The worldwide increasing energy demand and the environmental problem due to greenhouse gas emission, especially produced from fossil fuel combustion, have promoted research work to solve these crises. Diesel engine has proven to be one of the most effective energy conversion systems. It is widely used for power generation, land vehicles and marine power plant. To reduce diesel fuel consumption, an alternative energy sources, such as Hydrogen (H2), is promoted to use as dual-fuel system. H2 is considered as a fuel for future because it is more environmental friendly compared to carbon-based fuel. However, the most exiting diesel engines were designed for using diesel fuel. Feeding H2-diesel dual fuel to the engine, it is required to study its effect on engine operation parameters. Moreover, it is also an interesting point to observe the engine emission when H2-diesel dual fuel is used. Approach: The thermodynamic modeling was used to simulate the operating parameters, i.e., cylinder pressure and gas temperature. Finite different method was employed to find the solution. The H2 supply and EGR were varied. The pressure and temperature were observed. For NOx emission, which is a major problem for use of diesel engine, the thermodynamic equilibrium calculation was conducted to find the mole fraction of gas species in the exhaust gas. The mole fraction of NO and NO2 were combined to present as the mole fraction of NOx. Results: The simulation showed that at 5% EGR, increase of H2 caused increasing of cylinder pressure and temperature. It also increased NOx in exhaust gas. However, when H2 was fixed at 10%, increasing EGR led reducing of cylinder pressure and temperature. The mole fraction of NOx decreased with increasing EGR. Conclusion: The H2 supplied to the engine provided positive effect on the engine power indicated by increasing pressure and temperature. However, it showed the negative effect on NOx emission. Use of EGR was recommended for controlling NOx emission when H2 is supplied.