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Brazil has been a leader for the past 30 years in the development and commercialization of vehicles powered by ethanol, which contributes significantly to maintain the basic Brazilian energy less dependent on fossil fuels, but its usage was restricted to small vehicles with focus on gasoline replacement. Whereas the use of diesel fuel has significant impact on emission of greenhouse gases when it is compared to the whole production cycle of the alternative fuels (“well to wheel” analysis), these fuels have been the focus of studies, applications, federal government programs, and also the private sector, such as bio-diesel, sugar cane diesel, ethanol with additive for diesel cycle and diesel-gas Dual-Fuel. This paper will detail the development a high efficient engine fueled with 100% hydrated ethanol capable to achieve up to 42% of break efficiency, similar to a diesel efficiency running on Otto cycle.