This is a first of a series of papers describing how the replacement of some of the inlet air with EGR modifies the diesel combustion process and thereby affects the exhaust emissions. This paper deals with only the reduction of oxygen in the inlet charge to the engine (dilution effect).The oxygen in the inlet charge to a direct injection diesel engine was progressively replaced by inert gases, whilst the engine speed, fuelling rate, injection timing, total mass and the specific heat capacity of the inlet charge were kept constant. The use of inert gases for oxygen replacement, rather than carbon dioxide (CO2) or water vapour normally found in EGR, ensured that the effects on combustion of dissociation of these species were excluded. In addition, the effects of oxygen replacement on ignition delay were isolated and quantified. Results from final set of tests are also presented during which the inlet charge temperature was raised progressively to quantify the effect that EGR temperature has on combustion and emissions.The reduction in the inlet charge oxygen (dilution effect) resulted in very large reductions in exhaust NOx level at the expense of rises in particulates and unburnt hydrocarbon emissions. The engine power output and fuel economy also deteriorated substantially. Raising the inlet charge temperature increases NOx but also, substantially, the exhaust smoke and particulate emissions.