Depleting fossil energy reserves and large scale debasement of the environment has been grabbing headlines for some time now. Biodiesel has been proven by researchers to produce less CO, HC and PM, albeit higher NOx as compared to diesel. The present study was carried out with blends of Karanja - a type of Leguminosae plant abundant in India - that produces non-edible seed oil analogous to Jatropha. An exhaust gas recirculation (EGR) system was employed to encumber the higher NOx emissions produced with biodiesel. Performance and emission characteristics of Karanja biodiesel blend (KB20) with EGR rates of 0, 5, 10, 15 & 20% were compared with baseline data of diesel. The results show that adaptation of EGR with KB20 reduces NOx emissions without any penalty on smoke opacity or BSEC.