In the present scenario when the world is facing severe problem related to continuous decrease in the level of fossil fuels and increasing level of green house gases due to their uses in industries and automobiles, there is a high demand from all technologists and environmentalists to find and develop some alternative fuel especially manufactured from biomass like chlorella algae due to its presence in abundance. The mentioned algae is readily available and is being used as a dietary source in many countries especially in Japan due to its rich protein lipids and starch content and highly suitable for extraction of oil that can be used as an alternative to the existing fossil fuel diesel. The blend of B20 chlorella algae methyl ester or biodiesel is tested for its suitability with respect to its combustion performance and emissions characteristics in a variable compression ratio engine at 180 bar, 200 bar and 220 bar injection pressures. The performance data obtained are compared and analyzed for optimum performance with reference to mechanical, combustion properties and emissions of exhaust gases and a comparison is made with the properties obtained for pure diesel in similar conditions.