In this study, for the first time, a nano ceramic material of Al 2 O 3 was used as thermal barrier coating in a diesel engine. In the first phase, engine combustion chamber elements (cylinder head, cylinder liner, valves, and piston crown face) were coated with 200 lm thickness nano ceramic material of Al 2 O 3 by using plasma spray-coating method. In second phase, experiments were carried out on Al 2 O 3 -coated engine by using Pongamia methyl ester (PME), PME blends of 20 and 40% by volume with diesel and pure diesel. The test run was repeated on uncoated engine and the results were compared. An increase in engine power and decrease in specific fuel consumption, as well as significant improvements in exhaust gas emissions (except NO x ) and smoke density, were observed for all test fuels used in the Al 2 O 3 -coated engine compared with that of the uncoated engine.