Abstract The maximum potential of a dual-loop organic Rankine cycle (ORC) applied to a light-duty diesel engine is analyzed over the engine's operational range by developing a mathematical model based on physical processes and boundary conditions specified according to measured data from an engine test. We further evaluate the effects of three working parameters—expander isentropic efficiency, evaporation pressure of the high-temperature loop, and condensation temperature of the low-temperature loop—on the performance of the dual-loop ORC system. The results show that using the proposed dual-loop ORC system improves the net power output of a diesel automotive engine by 19–22% in the peak thermal-efficiency region under allowable working conditions of the engine, and by 53–72% in the high-speed and low-load regions. Over the engine's entire operational range, the effective thermal efficiency increases by a maximum of 8%. Moreover, the expander isentropic efficiency and the condensation temperature of the low-temperature loop are two critical parameters that affect combined system performance.