To achieve carbon-neutrality, internal combustion engines need to further improve their thermal efficiency to reduce CO2 emissions. To accomplish this, it is necessary to quantify and enhance five factors that control indicated thermal efficiency: compression ratio, specific heat ratio, combustion duration, combustion timing, and heat transfer to wall. In this work, quantitative targets for each factor were defined, which were derived from a simulation that considered the influence of heterogeneity of diesel combustion on thermal efficiency. The simulation utilized a two-zone combustion model. In particular, the targets for the combustion duration, combustion timing and heat transfer to wall were increased significantly compared to those for a conventional engine, in anticipation of an expansion of the load range of premixed charge compression ignition (PCI) combustion to higher loads. To expand the applicable load for PCI combustion, it was necessary to achieve a high degree of constant volume, low combustion noise, and clean emissions by suppressing the interference between the burned gas of the prior spray and the subsequent spray in the multi-stage injections near TDC. For this purpose, Distribution Controlled partially Premixed Compression Ignition (DCPCI) with the Dual Zone Egg-shape Combustion Chamber was proposed as a new combustion concept, and it was validated through CFD analysis that the DCPCI concept achieved high degree of constant volume and lean mixture formation. In addition, experiments were conducted on a new generation engine that applied the DCPCI combustion and other technologies such as slightly increased compression ratio, decreased intake temperature and increased wall temperature with a steel piston to improve the five control factors. The two-zone combustion model was utilized to analyze the result of the experiments, and improvements against the targets for the control factors was verified quantitatively. Furthermore, compared to a previous generation engine, a significant improvement in fuel consumption was confirmed without any adverse effects on emissions or combustion noise.