In recent years, gasoline direct injection (GDI) engines have been promoted worldwide by virtue of its advantages of economy and efficiency, but their particulate emissions are increased significantly compared to port fuel injection (PFI) engines. Ethanol has good research prospects due to its advantages such as high-octane number, low pollution and renewability. At the same time, ethanol has a certain effect on reducing particulate emissions from the engine. The existing research on the application of aqueous ethanol gasoline in GDI engine mainly focuses on the combustion and emission characteristics based on macroscopic characteristics, and there are few microscopic analysis of the flame development and soot formation. On basis of this, this paper studied the cylinder pressure, heat release rate and combustion phase of E10W (10% hydrous ethanol by volume ratio), E20W (20% hydrous ethanol by volume ratio) and E100W (pure hydrous ethanol) under different fuel injection strategies by optical single cylinder engine test, and analyzed the flame development and soot formation characteristics of the combustion process of hydrous ethanol gasoline. It was found that under the normal fuel injection strategy (start of injection, SOI=-280°CA), the peak value of cylinder pressure and heat release rate gradually increased with the increase of the proportion of hydrous ethanol, the cylinder pressure peak value of E100W increases by 10% compared to E10W, while the heat release rate did not increase significantly. The combustion phase angle advanced by 2°CA, the flame propagation speed increased by 15% and the combustion duration was shortened. The combustion coefficient of variation of E100W was 20% lower than that of the E10W and E20W. After delaying fuel injection (SOI=-90°CA), the change of the proportion of hydrous ethanol had no obvious effect on the combustion characteristics. The cylinder pressure peak value of E100W increased by 5%, the combustion phase was significantly advanced compared with the normal injection, and the combustion coefficient of variation increased to twice as much. The flame development characteristics showed that the flame brightness reached the maximum after the flame filled in the combustion chamber, and the flame front was biased toward the rich side of the mixture, which was consistent with the pool fire burning area on the wall. There were more yellow brown flames in the intense pool fire area, and the soot production was higher. Increasing the mixing ratio of the hydrous ethanol could accelerate the flame development speed. The time when E100W flame filled the combustion chamber was 3 ° CA ahead that of E10W and E20W, and the flame brightness increased. At the same time, after the fuel injection was delayed, the flame partitioning phenomenon in the cylinder was obvious, the uneven combustion phenomenon was intensified, and the combustion in the oil film pool was increased obviously. The addition of hydrous ethanol can improve the combustion characteristics, make the flame spread more uniform, reduce the area of pool fire burning intensely, and the relative content of soot can be reduced by 90%. Therefore, using a mixture of hydrous ethanol and gasoline as the fuel of GDI engines can effectively improve the combustion characteristics of the engine, accelerate the flame propagation speed and reduce the amount of soot, and have a better effect on improving the performance of GDI engines and reduce PM emissions.