Abstract: Due to the advantages of good economy, lighter specific mass and good mobility, the internal combustion engine has become the thermal energy machinery used most widely. With the increasing exhaustion of oil resources in the world and the challenge of increasingly stringent emission regulations, the advantages of biodiesel, such as low emission, renewable and biodegradable property, have aroused widespread concern, and meanwhile, engine manufacturers around the world have adopted a wide array of VNT (variable nozzle turbocharger) and EGR (exhaust gas recirculation) technologies in order to maintain performance when downsizing their engines. The focus of diesel engine emission control is NOx (nitric oxide) and PM (particulate matter) emissions. The terrain changes in China are complex; when the diesel engine runs in the plateau areas, due to that the air pressure is reduced, the air is thin and the oxygen content of the intake charge is reduced, the combustion of the engine is deteriorated, the engine power and economy are reduced, the NOx emission is reduced, and the PM emission is increased. EGR and VNT combined with the technology of mixing fuel containing oxygen can broaden the applicable conditions of EGR, and improve the air-fuel ratio, which could resolve the conflicts between NOx and PM emissions, but also reduce the degree of deterioration of diesel engine caused by rising altitude. A high pressure common rail diesel engine coupled with EGR and VNT is selected as the research type, and biodiesel and bio-ethanol are mixed into diesel fuel to form multi-component oxygenated fuel (biodiesel-ethanol-diesel, BED) at a certain proportion. Under the atmospheric pressure environment of 100 and 80 kPa (VNT opening and EGR valve opening (control EGR rate) are adjusted by ECU(electronic control unit), ES590 and INCA calibration software), the influence of VNT and EGR on the power, economy and emission characteristics of oxygenated fuel diesel is studied by atmospheric simulation system. The results show that the power and economy of the oxygenated fuel diesel engine become worse with the increase of the VNT opening and the EGR rate and the decrease of the atmospheric pressure. Under the condition of the atmospheric pressure of 80 kPa and the speed of 2 200 r/min, the opening of VNT increases from 22% to 28%, the torque is reduced by 3.8 N·m, and the average increase of oil consumption is 4.2 g/(kW·h). When the EGR rate increases by 5%, the torque is reduced by 0.8 N·m, and the average increase of oil consumption is 1.5 g/(kW·h). When the atmospheric pressure is reduced from 100 to 80 kPa, the torque is reduced by an average of 3.4 N·m, and the average increase of oil consumption is 4.9 g/(kW·h). When the VNT opening increases from 22% to 28%, the average NOx decreases by 15%. When the EGR rate increases by 5%, the average NOx emission decreases by 12%. When the atmospheric pressure increases from 80 to 100 kPa, the average increase of NOx emissions is 11%. When the VNT opening increases from 22% to 28%, the average increase of smoke is 477%. When the EGR rate increases by 5%, the average increase of smoke is 331.9%. When atmospheric pressure decreases from 100 to 80 kPa, the average increase of smoke is 96.6%.