Non-edible oil biodiesels and alcohols are the two major liquid fuel sources available to replace diesel to fuel compression ignition engine. This study is to investigate the solubility, properties and performance of biodiesel from non-edible rice bran oil and ethanol. Solubility test was conducted in three different temperatures 50C, 150C& room temperature (300C approximately). The stable blends were tested for essential properties such as energy content, cetane number, kinematic viscosity, heat of vaporisation, flash point and oxygen content as per ASTM standards. Biodiesel- ethanol blends containing 30% of ethanol was found stable up to 50C. This blend also met the minimum requirement with respect to properties to fuel compression ignition engine. These blends were tested in compression ignition engine for performance, combustion and emission characteristics in various load conditions under two compression ratios (17,1 & 18,1). Results showed that the compression ratio 18:1 was found suitable for the optimal blend. This blend produced brake thermal efficiency, peak incylinder pressure, peak heat release rate, hydrocarbon, carbon monoxide, and smoke similar to that of diesel. However, ignition delay & emission of oxides of nitrogen produced by this blend was found slightly higher compared to diesel.