Ethanol with high levels of hydration is a low cost fuel that offers the potential to replace fossil fuels and contribute to lower carbon dioxide (CO2) emissions. However, it presents several ignition challenges depending on the hydration level and ambient temperature. Advanced combustion concepts such as homogeneous charge compression ignition (HCCI) have shown to be very tolerant to the water content in the fuel due to their non-flame propagating nature. Moreover, HCCI tends to increase engine efficiency while reducing oxides of nitrogen (NOx) emissions. In this sense, the present research demonstrates the operation of a 3-cylinder power generator engine in which two cylinders operate on conventional diesel combustion (CDC) and provide recycled exhaust gas (EGR) for the last cylinder running on wet ethanol HCCI combustion. At low engine loads the cylinders operating on CDC provide high oxygen content EGR for the dedicated HCCI cylinder. Besides the advantageous EGR composition from CDC combustion, directly recycled exhaust heat is also beneficial to promote auto ignition in the dedicated wet ethanol cylinder. At high engine loads not enough air could be provided by the EGR from CDC and ambient air was bypassed to the HCCI cylinder. Lean burn combustion was employed to expand the HCCI operation boundaries compared to stoichiometric conditions. Stable HCCI operation was achieved from idle to 5 bar IMEP under different combinations of air/fuel ratio, EGR rate, EGR composition, and ethanol-water blends. HCCI combustion could be obtained at low loads thanks to the heat rejection form CDC and the high stock compression ratio of 16.6:1. Optimal operating parameters were defined for the range of variables evaluated. Heat release and emission analysis were performed and all acquired data was compared to previous results obtained with spark ignition combustion in the same dedicated cylinder of the engine.