Biofuel is a crucial renewable and environmentally friendly energy source for addressing greenhouse gas emissions and other energy-related issues. Biodiesel and butanol, among alternative biofuels, possess complementary physical and chemical properties, offering multiple possibilities for their use in existing internal combustion engines. However, biodiesel’s distinctly different physical and combustion properties from conventional diesel fuels make its combustion process substantially different. The complex composition of biodiesel presents significant challenges in accurately simulating its spray combustion characteristics. This paper presents a systematic evaluation of six single-component surrogate fuel models and a five-component model for the prediction of biodiesel spray characteristics under various conditions using large-eddy simulation (LES). The results show that single-component surrogate fuel models can only predict the gaseous penetration of biodiesel but not the liquid-phase penetration. A five-component fatty acid methyl ester surrogate fuel model is proposed, demonstrating an accurate simulation of biodiesel spray evaporation characteristics under different conditions. Based on the five-component evaporation model, LES is utilized to examine three strategies of biodiesel/butanol-fueled internal combustion engines: direct injection of pure biodiesel in conventional diffusion-controlled combustion (CDC) engines, direct injection of biodiesel–butanol blend in CDC engines, and biodiesel/butanol reactivity-controlled compression ignition (RCCI) engines. The simulation results are validated against engine experiment results, showing that the five-component model can successfully predict spray and combustion characteristics in internal combustion engines. The RCCI concept can significantly reduce NOx emissions; however, CO and UHC emissions are higher than in the CDC engines due to incomplete combustion in the fuel-lean butanol/air mixture.