Nitromethane has a stoichiometric air–fuel ratio of 1.7, which is 8.5 times lower than gasoline. For the same amount of air being drawn by the engine, more amount of nitromethane blends and hence more energy can be added. Methanol was used as a medium to mix nitromethane and gasoline, which are normally immiscible. Engine performance tests were carried out to study the effect of nitromethane addition to the methanol-gasoline blend. A large rise in engine torque and brake thermal efficiency (BTE) was obtained during the investigation. However, the brake specific fuel consumption (BSFC) also increased for the nitromethane blends. The engine parameters like spark timing, equivalence ratio, and compression ratio were optimized to further increase the engine power and also bring down the BSFC. A net torque improvement of 42%, BTE improvement of 35%, and BSFC rise of 9% were obtained by adding nitromethane and methanol in small fractions to gasoline. Combustion analysis was carried out using the cylinder pressure trace. High heat release rate and shorter combustion duration with nitromethane addition were observed. Emission measurements showed decrease in HC and CO emissions with nitromethane addition. However, a drastic rise in NO emissions was observed. Hence, it can be concluded that the specific power of small two-stroke spark ignition (SI) engines can be enhanced using nitromethane as a fuel additive to increase the payload of the unmanned aerial vehicles.