In the present paper, a new biofuel ethylene glycol monomethyl ether soyate has been developed. The biofuel was synthesized with a refined soybean oil and ethylene glycol monomethyl ether as reactants and sodium as catalyst under 90°C. The synthesized crude product was purified and structurally identified through Fourier Transform Infrared Spectrum (FT-IR), 1H Nuclear Magnetic Resonance Spectroscopy (1H NMR) and Gel Permeation Chromatography (GPC) analyses. The physicochemical properties of the biofuel and its addition effects on properties of diesel fuel were measured according to China national standard test methods. A single cylinder diesel engine was employed to evaluate the influences of the biofuel on engine fuel economy and engine-out emissions of CO, HC, NOx and smoke. Test results reveal that when the diesel engine is fueled with this biofuel, engine-out smoke emissions can be decreased by 54.7% to 85.7%, CO emissions reduced by up to 79.1% and unburned HC emissions lessened by 61.6%. When the diesel engine burns a 1:1 by volume mixture of the biofuel and diesel fuel, smoke emissions can be diminished by 46.5% to 83.3%, CO decreased by up to 69.8% and HC emissions reduced by 59.6%. NOx emissions generally do not change significantly, fuel consumption increased by 1.4% to16.9%, but energy consumption decreased by 3.2% to 7.9%.