To reduce the exhaust emission of diesel engine, new water-in-oil type emulsion technology was devised. Emulsion fuel was made by only ultrasonic wave (40kHz, 200W), and injected immediately to engine combustion chamber using specially designed apparatus. Surfactant was never used. The experiment results of emulsion fuel are very positive. Experimental engine is 4 cycle, single cylinder compression ignition diesel engine, and its output is 6.5kW. In the case of 30% of water content, specific fuel consumption was reduced by max. 28%, smoke by max. 60%, and CO emission by max. 79%. However, HC emission was getting more serious on the contrary. Micro explosion phenomenom of water-in-oil emulsified fuel was attributed to a primary factor for the above mentioned positive effects.(author). Refs. and figs.