Abstract: This project gives idea for the effective use of Waste Transformer Oil as an alternate option for petroleum based fuels. Rapid depletion of fossil fuels, increasing pollution and increasing prices of petroleum based fuels have given a base for the research of various fossil fuels. As we all know that, petroleum based fuels are limited in reserves, concentrated in certain regions of the world are shortening day by day. Huge amount of dollars are being invested in research of alternative fuels. Meanwhile, the disposal of waste products like waste transformer oil from different electric power stations from many electric transformers throughout the country is becoming increasingly complex. while biodiesel from certain vegetable oils like Jatropha, Karanja, Soyabean and Rapeseed is acquiring much needed attention. The Waste Transformer Oil is a waste product which comes out from a electrical transformer is used for insulation and cooling purpose. This waste product can be used asansource of fuel for diesel engine applications. The WTO can be used after refining it by transesterification process or catalytic cracking process and then mixed with diesel fuel as an base fuel for evaluating different engine and emission parameters and to use it as an alternate source of fuel. The engine and fuel researchers are devoted to explore alternative fuels as the present world largely depends on petroleum fuel for generating power, vehicle movement and agriculture sectors. Price hike, limited reserve of petroleum oils and stringent emission regulation also forced researchers to find alternative fuels. In Bangladesh, there is limited petroleum reserve to meet the demand of the petroleum product and for this reason it is necessary to spend a lot of foreign currency for importing fuel every year. Recent price hike of petroleum oil incurs lots of money. Bangladesh imports most of the petroleum oils from Middle East. In this point of view, waste transformer oil (WTO) can be an alternative source for petroleum oils. WTO has significant physiochemical properties. WTO can meet a portion of our demand without any hesitation. There is a huge unused amount of transformer oil in Bangladesh which is rejected every year. This oil is not used for any other purpose. So, WTO is an important source for meeting the demand of diesel in Bangladesh. Bangladesh imports approximately 2.4 million ton diesel each year . It is well known that the transformer oil is used mainly in the electrical transformer for insulation purpose. Moreover, cooling is another purpose of using transformer oil in the electrical transformer while the transformer is running. Among various properties, one of the main properties of transformer oil is to sustain high temperature during operation. When an electrical transformer is in operation, the transformer oil is subject to mechanical and electrical resistance. For a certain period of time, it is recommended to check the electrical and chemical properties of the transformer oil. By using WTO, Bangladesh can reduce importing a huge amount of petroleum products from foreign countries. Our attention goes to the WTO. WTO results from the power generation and transmission station. At present 100 per cent transformer oil is not used in place of diesel fuel (DF) to run the engine rather blends of WTO and DF. Keywords: Waste transformer oil, WTO characteristics, Diesel fuel