This contribution focuses on utilizing blended biofuels of rapeseed oil and methanol with diesel. Rapeseed is one of the most cultivated energy crops in Europe, and its purpose in the blends is to increase the bio-content in test fuels. The purpose of methanol in the blends is to increase bio-content and compensate for the higher viscosity of the rapeseed oil. As methanol is almost insoluble in diesel and rapeseed oil, iso-butanol is used as a co-solvent. The fuel blends were tested in volumetric concentrations of diesel/rapeseed oil/methanol/iso-butanol 60/30/5/5, 50/30/10/10, and 50/10/20/20. Diesel was used as a reference. The measurements were performed on a turbocharged diesel engine Zetor 1204, loaded using the power-takeoff shaft of the Zetor Forterra 8641 tractor. In this paper, the effect of the blended fuels on performance parameters, engine efficiency, production of soot particles, and regulated and unregulated emissions are monitored and analyzed. It was found that engine power decreased by up to 27%, efficiency decreased by up to 5.5% at full engine load, emissions of NOX increased by up to 21.9% at 50% engine load, and production of soot particles decreased; however, the mean size of the particles was smaller.