Biodiesel is popularly discussed in many countries due to increased environmental awareness and the limited supply of petroleum. One of the main factors impacting general replacement of diesel by biodiesel is NOx (nitrogen oxides) emissions. Previous studies have shown higher NOx emissions relative to petroleum diesel in traditional direct-injection (DI) diesel engines. In this study, effects of injection timing and different biodiesel blends are studied for low load [2 bar IMEP (indicated mean effective pressure)] conditions. The results show that maximum heat release rate can be reduced by retarding fuel injection. Ignition and peak heat release rate are both delayed for fuels containing more biodiesel. Retarding the injection to post-TDC (top dead center) lowers the peak heat release and flattens the heat release curve. It is observed that low-temperature combustion effectively reduces NOx emissions because less thermal NOx is formed. Although biodiesel combustion produces more NOx for both conventional and late-injection strategies, with the latter leading to a low-temperature combustion mode, the levels of NOx of B20 (20 vol % soy biodiesel and 80 vol % European low-sulfur diesel), B50, and B100 all with post-TDC injection are 68.1%, 66.7%, and 64.4%, respectively, lower than pure European low-sulfur diesel in the conventional injection scenario.