Abstract.The spin-1 Ising-Heisenberg diamond chain with the second-neighbor interaction between the nodal spins is rigorously solved using the transfer-matrix method. Exact results for the ground state, magnetization process and specific heat are presented and discussed in particular. It is shown that the further-neighbor interaction between the nodal spins gives rise to three novel ground states with a translationally broken symmetry, but at the same time, it does not increases the total number of intermediate plateaus in a zero-temperature magnetization curve compared with the simplified model without this interaction term. The zero-field specific heat displays interesting thermal dependencies with a single-or double-peak structure.