In this work, palm biodiesel was evaluated as an alternative to the petroleum diesel in compression ignition engine. This work would pave the way for the evaluation of the technological feasibility of employing palm biodiesel (BD100) in a diesel engine and also to discover the prospect of running a diesel engine on acetone in the dual-fuel blending mode to view its emission characteristics. Acetone was blended with palm biodiesel and operated at a compression ratio of 16. A base-catalysed transesterification process was employed to convert palm oil into palm biodiesel. Acetone with 96.4% purity was used as an oxygenated additive. The experimental results have revealed that the acetone to palm biodiesel blends gave a significant reduction in HC (hydrocarbons), CO (carbon monoxide), NO_x (nitrogen oxides) and smoke emissions when compared to palm biodiesel under naturally aspirated conditions.