The effects of biodiesel on the performance and emission characteristics of a single cylinder, four stroke, naturally aspirated and direct injection diesel engine were investigated experimentally. The tests were conducted using a soybean oil based biodiesel and its blends of 10%, 20%, 50%, and 75% of biodiesel with diesel fuel and for five different engine loads at constant engine speed of 3000 rpm. The tests with diesel fuel were also carried out for comparison purposes. The results show that the fuel consumption generally increase with increasing amount of biodiesel in the fuel and the thermal efficiency slightly increase with using biodiesel. The biodiesel reduces the HC emissions and increases the NOx emissions. On the other hand, the effects of biodiesel on the CO and CO2 emissions are found as negligible. Also, the biodiesel blend B 10 is found to be the most suitable fuel to use without any changes on the available diesel engines.