An experiment was conducted with a direct injection Diesel engine operated with neat dimethyl ether (DME). Main focus of this research is to investigate the performance of the catalysts designed for NOx reduction, such as Co–alumina and Sn–alumina catalysts, for the reduction of NOX and other unburned species contained in the exhaust gas. In the experiments, DME concentration in the exhaust gas was changed by adding extra DME before the catalytic reactor, which is the important experimental parameter in the research. Results showed that NOX reduction rate was not so high without any DME addition, because the content of unburned DME, reducing agent, is very low in the DME engine exhaust gas. However, NOX reduction rate increased with increase in DME content and it reached around 80% with enough DME addition. The NOX reduction rate increased with increase in reaction temperature up to around 300 °C. The possibility of methanol and formaldehyde formation on the catalyst bed at lower reaction temperature was also pointed out.