It is becoming increasingly difficult for engines using conventional fuels and combustion techniques to meet stringent emission norms. The homogeneous charge compression ignition(HCCI) concept is being evaluated on account of its potential to control both smoke and NOx emissions. However, HCCI engines face problems of combustion control. In this work, a single cylinder water-cooled diesel engine was operated in the HCCI mode. Diesel was injected during the suction stroke($0^{circ}$ to $20^{circ}$ degrees aTDC) using a special injection system in order to prepare a nearly homogeneous charge. The engine was able to develop a BMEP(brake mean effective pressure) in the range of 2.15 to 4.32 bar. Extremely low levels of NOx emissions were observed. Though the engine operation was steady, poor brake thermal efficiency(30% lower) and high HC, CO and smoke were problems. The heat release showed two distinct portions: cool flame followed by the main heat release. The low heat release rates were found to result in poor brake thermal efficiency at light loads. At high brake power outputs, improper combustion phasing was the problem. Fuel deposited on the walls was responsible for increased HC and smoke emissions. On the whole, proper combustion phasing and a need for a well- matched injection system were identified as the important needs.