The present work deals with the preparation of bio-diesel from Rice Bran oil and testing the performance and emission characteristics of a single cylinder, four stroke, Direct Injection (DI) diesel engine by using conventional diesel, 100% Rice Bran Methyl Ester (RBME), RBME with 1% Methanol additive, RBME with 3% Methanol and RBME with 5% Methanol at various loads (no load, 0.97 kW, 1.94 kW, 2.91 kW, 3.88 kW) and comparing the important properties such as Flash and Fire points, Kinematic Viscosity, Density, Calorific Value and performance parameters such as Brake Specific Fuel Consumption, Brake Power, Brake Thermal Efficiency, A/F ratio, Equivalence ratio of diesel and bio diesel and also their Emission characteristics. It is observed that, for RBME + 1% methanol, the Brake Thermal Efficiency at full load i.e 3.88 kW is increased by 5.83% compared to conventional diesel, Exhaust gas temperature is decreased by 9.6%, O2 emissions are decreased by 29.42% and CO2 emissions are increased by 55.17%.