In this work, the possibility of using a two-color LIF (laser-induced fluorescence) approach for fuel composition and temperature measurements using nile red dissolved in n-decane/butanol blends is investigated. The studies were conducted in a specially designed micro cell enabling the detection of the spectral LIF intensities over a wide range of temperatures (283–423 K) and butanol concentrations (0–100 vol.%) in mixtures with n-decane. Furthermore, absorption spectra were analyzed for these fuel mixtures. At constant temperature, the absorption and LIF signals exhibit a large spectral shift toward higher wavelengths with increasing butanol concentration. Based on this fact, a two-color detection approach is proposed that enables the determination of the butanol concentration. This is reasonable when temperature changes and evaporation effects accompanied with dye enrichment can be neglected. For n-decane, no spectral shift and broadening of the spectrum are observed for various temperatures. However, for butanol admixture, two-color thermometry is possible as long as the dye and butanol concentrations are kept constant. For example, the LIF spectrum shows a distinct broadening for B20 (i.e., 80 vol.% n-decane, 20 vol.% butanol) and a shift of the peak toward lower wavelengths of about 40 nm for temperature variations of 140 K.