As the need for alternative energy sources and reduced emissions grows, proven technologies are often sidelined in favour of emerging solutions that lack the infrastructure for mass adoption. This study explores a transitional approach by modifying existing compression ignition engines to run on a hydrogen/diesel mixture for performance improvement, utilising water injection to mitigate the drawbacks associated with hydrogen combustion. This approach can yield favourable results with current technology. In this modelling study, ten hydrogen energy ratios (0–90%) and nine water injection rates (0–700 mg/cycle) were tested in a turbocharged Cummins ISBe 220 31 six-cylinder diesel engine. An engine experiment was conducted to validate the model. Key performance indicators such as power, mechanical efficiency, thermal efficiency, indicated mean effective pressure (IMEP), and brake-specific fuel consumption (BSFC) were measured. Both water injection and hydrogen injection led to slight improvements in all performance metrics, except BSFC, due to hydrogen’s lower energy density. In terms of emissions, CO and CO2 levels significantly decreased as hydrogen content increased, with reductions of 94% and 96%, respectively, at 90% hydrogen compared to the baseline diesel. Water injection at peak rates further reduced CO emissions by approximately 40%, though it had minimal effect on CO2. As expected, NOx (which is a typical challenge with hydrogen combustion and also with diesel engines in general) increased with hydrogen fuelling, resulting in an approximately 70% increase in total NOx emissions over the range of 0–90% hydrogen energy. Similar increases were observed in NO and NO2, e.g., 90% and 57% increases with 90% hydrogen, respectively. However, water injection reduced NO and NO2 levels by up to 16% and 83%, respectively, resulting in a net decrease in NOX emissions in many combined cases, not only with hydrogen injection but also when compared to baseline diesel.