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Low heat rejection engine (LHRE) technology reduces the heat transfer from the gases in the cylinder of an internal combustion engine by insulating the walls of the combustion chamber. This technology has the potential for gains in fuel efficiency, cooling system size decrease, the use of alternative fuels, etc. Research on many experimental LHRE's has been reported in the literature. However, these engines have used ceramic material and they have two major problems that need to be overcome. They are: (1) the need for a high temperature lubrication system, and (2) brittleness of the ceramics. To overcome these limitations, a novel LHRE design has been developed in this study. In this design, a high temperature superalloy HAYNES®230™ (USN N06230)' is used instead of ceramics, and conventional low temperature lubrication can be employed. A 3.5 HP one cylinder low heat rejection Diesel engine was developed in this study and tested for 1001 hours without failure.