Preheated Schizochytrium sp. raw microalgae oil (MAO) was evaluated as a fuel in a single-cylinder four-stroke diesel engine to produce a comparative study of MAO and diesel oil (DO) critical parameters. In particular, brake power, brake specific fuel consumption (BSFC), brake thermal efficiency (BTE), in-cylinder pressure (CP), exhaust gas temperature (EGT), both nitrogen oxides (NOx) and carbon monoxide (CO) emissions were investigated. Additionally, an engine durability test for longevity was undertaken over a 30-h period, using raw MAO as the fuel. The study demonstrated that the preheated MAO could be successfully used in a diesel engine smoothly. The use of MAO reduced the engine brake power by 26% and increased brake-specific fuel consumption by 20%. The most significant finding from this research study is that there was a significant reduction in NOx and CO emission by 42% and 60% when using raw MAO, respectively. Therefore, these findings demonstrate that algae oil is a highly credible fuel for use in diesel engines and offers a promising solution to diesel engine emissions.