The importance of including turbocharger dynamics in diesel engine models are studied, especially when optimization techniques are to be used to derive the optimal controls. This is done for two applications of diesel engines where in the first application, a diesel engine in wheel loader powertrain interacts with other subsystems to perform a loading operation and engine speed is dictated by the wheel speed, while in the second application, the engine operates in a diesel-electric powertrain as a separate system and the engine speed remains a free variable. In both applications, mean value engine models of different complexities are used while the rest of system components are modeled with the aim of control study. Optimal control problems are formulated, solved, and results are analyzed for various engine loading scenarios in the two applications with and without turbocharger dynamics. It is shown that depending on the engine loading transients, fuel consumption and operation time can widely vary when the turbocharger dynamics are considered in the diesel engine model. Including these, have minor effects on fuel consumption and operation time at minimum fuel operations of the first application (≈ 0:1%) while the changes are considerable in the second application (up to 60%). In case of minimum time operations however, fuel consumption and operation time are highly affected in both applications implying that not considering turbocharger dynamics in the diesel engine models may lead to overestimation of the engine performance especially when the results are going to be used for control purposes.