This paper presents an analysis of the potential of E85 (a mixture of 85 % (bio)ethanol and 15 % gasoline) as a fuel for spark-ignition (SI) direct-injection internal combustion engines. This involves investigation of not only application to downsizing concepts with high specific power but also behavior relating to emissions and efficiency at both part and full load. Measurements while running on gasoline were used for comparison purposes.The first stage involved analysis using 1D simulation of two different downsizing concepts with regard to turbocharging potential and performance. Following this, various influential parameters such as injector position, injection pressure, compression ratio, degree of turbocharging etc. were investigated on a single cylinder research engine. In the case of high pressure direct injection, particulate emissions also play an important role, so particulate count and particulate size distribution were also studied in detail.