Biodiesel obtained from mustard seed is found to be a promising alternative for petroleum diesel fuel owing to its similarity in physical and chemical properties. In this work, TiO₂ nano-fluid which acts as an oxygen buffer during combustion was added to mustard oil biodiesel (MOBD) to study its effect on emission characteristics of MOBD. TiO₂ nano-fluid can provide high surface energy during the course of combustion and reduces the limitations of neat biodiesel. A four-stroke, multi-cylinder, water-cooled, diesel engine was used in the experiments and was fueled with diesel, neat MOBD and MOBD with TiO₂ nanoparticles at 100 ppm (MOBDT100), 200 ppm (MOBDT200) and 300 ppm (MOBDT300). Experimental results revealed that the TiO₂ nanoparticles had positive effect on the emission characteristics of MOBD as it acted as an oxidation buffer. MOBDT300 showed a reduction in HC, CO and smoke emissions as compared to pure MOBD. In addition, NO_x emissions were also reduced by the catalytic activity of the TiO₂ nanoparticles which reduce the peak combustion temperature. Therefore, TiO₂ nano-fluid had a positive effect on reducing the emissions associated with neat biodiesel.