Exhaust gas recirculation (EGR) has been proven an effective strategy for the ignition and combustion control in homogeneous charge compression ignition (HCCI) engines. Carbon dioxide (CO2), a major constituent in EGR, was found to pose a coupled effect on engine combustion: reduced intake oxygen concentration (dilution effect), increased gas heat capacity (thermal effect) and participation of CO2 in chemical reactions (chemical effect). In this paper, a numerical study using a detailed chemical kinetic model was conducted, aiming to isolate the dilution, thermal and chemical effects of CO2 on the two-stage auto-ignition process of n-heptane at engine-like pressure conditions. Four different initial temperatures were selected in this study, representing the low-temperature dominant region, the boundary between the low-temperature region and the negative temperature coefficient (NTC) region, the NTC region and the high temperature region, respectively. The results indicate that for all initial temperatures, the dilution effect of CO2 always plays the dominant role and results in retarded ignition at both ignition stages. Thermal and chemical effects of CO2 are negligible on the first-stage ignition, but are noticeable on the second-stage ignition. With CO2 addition, increased gas heat capacity retards the second-stage ignition but the participation of CO2 in chemical reactions could advance the second-stage ignition. In addition, as the initial temperature increases from the low-temperature region to the high-temperature region, the chemical effect of CO2 on advancing ignition could overcome its thermal effect on retarding ignition at the second-stage ignition. The pathways and key reactions that CO2 participates in are analyzed.