This research is attempted to study of diesel oil-water emulsion fuel (water in-oil type) for direct injection single cylinder diesel engine. The laboratory experimental project is using 10% water mixed with Diesel Oil (DO) and in a few of inorganic surfactant by volume ratio (10% water, 89% diesel oil, 1% surfactant). These components are mixed in mechanical mixer controlled, to produce blending fuel. During the blending process the special surfactant will make oil surrounds the water droplet to prevent the water from separating out of the mixture. The encapsulation of water in oil in micrometer sizing is prevents the water from contacting any metal engine parts. The experimental laboratory is conducted with single cylinder diesel engine set-up at 2000 rpm with variable of engine load. Measurement of engine emissions parameters at different load conditions have generally indicated reduce in engine CO, NO and SO2 emission as compared to base diesel oil.