A free-piston linear generator (FPLG) is a novel engine device that can operate with different types of fuel owing to its varying compression ratio to generate electrical energy. In this paper, an experimental test rig is developed and tested to achieve a steady-state operating condition. The engine is fuelled with a premixed mixture of compressed natural gas and carbon dioxide having 80 and 20 proportion by volume. The combustion and performance characteristics of the engine are investigated at various injection positions, ignition velocities, and lambda. The results reveal that engine combustion characteristics and performance are improved when the lambda tends towards a rich mixture, and the injection position is advanced. However, there is a limitation for the ignition velocity, nonetheless, the peak power is found at 1.0 m/s ignition velocity. Based on the optimum condition, the peak rate of heat released obtained is 178.94 kJ/s and the peak output power generated is 1790 W. The FPLG engine's combustion efficiency, mechanical efficiency, and indicated thermal efficiency are 29.5, 41.4, and 12.2, respectively. The engine displays high stability of 5.4 when fuelled with CNG-CO2. © 2021 Elsevier Ltd