Sustainable policy leads to partially replace fossil diesel by bio-fuels and ethanol/diesel blends. The major challenge is how to enhance miscibility of ethanol with diesel. Molecular dynamics simulation was applied to study the effects of alcohol co-solvents on miscibility of ethanol with diesel. The 1-heptanol, 1-decanol, n-butanol, and butanol isomers were selected as co-solvents. The diesel model was constructed to quantitatively characterize miscibility and obtain interaction of ethanol and diesel. The solubility parameters, structural feature, and energy properties were analyzed. The results showed that long-chain alcohol co-solvents contributed to miscibility of blends. The aromatics had more effects on miscibility than linear alkanes and cycloalkanes. Radial distribution function results showed that straight-chain alcohols or high linearity co-solvents promoted miscibility of ethanol than branched alcohols. The energy analysis revealed that the hydrogen bonding and van der Waals interaction were the main driving forces to improve miscibility, while polarization interaction had no major contribution. The hydrogen bonding dominated for short-chain alcohols, while van der Waals interaction was vital for long-chain alcohols. The coordination of hydrogen bonding and van der Waals energy in dynamic equilibrium led to the optimal miscibility.