Performance analysis of a diesel engine in terms of Effective Power (EP), Effective Power Density (EPD), and Effective Efficiency (EE) has been performed using a novel realistic Finite-Time Thermodynamics (FTT) modeling approach. The effects of design and operating parameters of the diesel cycle, such as bore-stroke length ratio (d/ L), Equivalence Ratio (ER), Compression Ratio (CR), Cycle Temperature Ratio (CTR), Cycle Pressure Ratio (CPR), stroke Length (L), friction coefficient (FRC), engine speed (N), mean piston speed, inlet pressure, and inlet temperature, on the engine performance have been investigated. In addition, energy losses depending on Incomplete Combustion (IC), friction losses (FRL), heat transfer losses (IITRL), and Exhaust Output Losses (EOL) have been described as fuel input energy. In order to acquire reasonable results, variable specific heats with respect to temperature for working fluid have been used. The results presented could be an essential tool for diesel engine designers. (C) 2019 Sharif University of Technology. All rights reserved.