This disclosure provides a method of controlling a diesel engine. The method includes adjusting an EGR ratio according to an engine load so that a cylinder O2 concentration decreases gradually to a predetermined load with an increase in the load of the engine, while the O2 concentration increases gradually above the predetermined load, operating the engine in a premix combustion mode where the fuel injection is terminated before a top dead center of a compression stroke in a low load operating range including the predetermined load where the O2 concentration is lowest and, after that, the fuel ignites and combusts, and operating in a diffusion combustion mode where the fuel injection is executed in parallel to the ignition and combustion of the fuel in an operating range where the load is higher than that of the operating range in the premix combustion mode and the O2 concentration is relatively high.