Premixed Charge Compression Ignition (PCCI) presents a promising alternative to conventional diesel combustion (CDC), offering significant reductions in pollutant emissions by lowering local in-cylinder temperatures and enhancing fuel-air mixing. However, a significant challenge in implementing PCCI is controlling the start of combustion, especially given its narrow operating load range. This is primarily due to early ignition and knocking combustion at higher loads when using high-reactivity diesel fuel, which limits the practical applicability of PCCI mode in diesel engines. In the present study, experimental investigations are carried out on a light-duty diesel engine operating in PCCI mode using two fuel blends: 10% (D90G10) and 20% (D80G20) gasoline mixed with diesel on a volume basis. To facilitate combustion control and emission reduction, exhaust gas recirculation (EGR) and water vapor are used as charge diluents. A common rail direct injection (CRDi) system replaces the conventional mechanical fuel injection system, and the engine's compression ratio is reduced from 17.5 to 15 to enable PCCI operation. Initial parametric studies revealed that early direct injection combined with high injection pressure limited the PCCI operating load range to 30% of the rated load when using diesel fuel. However, incorporating EGR with diesel extended this load range to 60%, albeit with increased unburnt hydrocarbon (HC) and carbon monoxide (CO) emissions. To address these challenges, the engine's cylinder head was modified to accommodate a vertically oriented injector, and diesel was replaced with diesel–gasoline blends. Experiments were then conducted using the modified cylinder head at a constant engine speed of 1500 rpm, under varying load conditions and injection timing, to analyze the effects of injector orientation and fuel blends in combination with EGR and water vapor as charge diluent. The results indicate that the diesel–gasoline blends increase ignition delay and enhance fuel-air mixing time between the end of fuel injection and the start of combustion. Specifically, with the G20D80 blend and combined EGR and water vapor dilution, the engine's operating load range was extended to 74% of the rated load. Compared to the CDC, emissions of NOx and soot were significantly reduced. Additionally, HC and CO emissions were reduced by 11.2% and 43.2% at 60% loads, and smoke was reduced by 57.6%, compared to the baseline PCCI, using EGR and water vapor as charge diluents with D80G20 fuel blends.