Increase in industrialization and transportation of different equipments all over the world in all sectors  led to the increasing demand of vehicles.[3] To run these vehicles mostly Diesel engines are used. But due to the scarcity of petroleum based fuel like Diesel, it is necessary to go for the fuels other than conventional fuels which will require little or no engine modification. Again the fuel should be economical as well as environment friendly in order to follow the stringent emission norms. In this context waste tyre pyrolsis oil is the most emerging fuel which is tested to evaluate the performance analysis with Diesel fuel in Single cylinder water cooled variable compression ratio type Diesel engine. Tests were carried out with 100% Diesel and then 10%, and 50% of tyre pyrolysis oil (TPO) blended with Diesel fuel (DF) for different loading conditions. It is observed that the brake power, indicated power as well as Brake mean effective pressure(BMEP) increased when diesel blended with tyre pyrolysis oil at higher loads while friction power decreases with increase in TPO concentration in the blend as well as with increase in load. The variation of Brake thermal efficiency with load was also observed and it is found the tyre blends D75% + TPO25% shows maximum thermal efficiency than other blends with diesel.Again engine can run without any modification with addition of 50 % TPO by volume with Diesel