The use of cooled EGR as a knock suppression tool is gaining more acceptance worldwide. As cooled EGR become more prevalent, some challenges are presented for engine designers. In this study, the impact of cooled EGR on peak cylinder pressure was evaluated. A 1.6 L, 4-cylinder engine was operated with and without cooled EGR at several operating conditions. The impact of adding cooled EGR to the engine on peak cylinder pressure was then evaluated with an attempt to separate the effect due to advanced combustion phasing from the effect of increased manifold pressure. The results show that cooled EGR's impact on peak cylinder pressure is primarily due to the knock suppression effect, with the result that an EGR rate of 25% leads to an almost 50% increase in peak cylinder pressure at a mid-load condition if the combustion phasing is advanced to Knock Limited Spark Advance (KLSA). When combustion phasing was held constant, increasing the EGR rate had almost no effect on PCP. In addition, since EGR enables higher compression ratio operation, some data was taken at elevated compression ratios to establish the impact of EGR at a constant load with increased compression ratio.