The effect of using solutions of ethanol and gas-oil (duel fuel) to fuel the diesel engine on engine performance and heat release have been studied experimentally. A single cylinder diesel engine type Recardo (E6/US) was used and the ethanol percentage in the solution was varied from 0 to 20 percent. The results showed that, in general, addition of ethanol to gas-oil cause the maximum power output to decrease at medium and high range of speed and it was nearly the same as that of the straight gas -oil at low speed ranges. The specific fuel consumption of the dual is nearly the same as that of straight gas-oil at low and medium ranges of load. But at high ranges of load the specific fuel consumption was increase. In general, the addition of ethanol to gas-oil cause the maximum rate of heat release to increase during the first stage of combustion and decrease during the second stage of combustion. Further substitution of gas-oil with ethanol(higher than 20 percent) was limited by knock.