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<TYPE>8-K
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<ITEMS>8.01
<ITEMS>9.01
<FILING-DATE>20060125
<DATE-OF-FILING-DATE-CHANGE>20060125
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<COMPANY-DATA>
<CONFORMED-NAME>CLEAN DIESEL TECHNOLOGIES INC
<CIK>0000949428
<ASSIGNED-SIC>2810
<IRS-NUMBER>061393453
<STATE-OF-INCORPORATION>DE
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<ACT>34
<FILE-NUMBER>000-27432
<FILM-NUMBER>06548224
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<BUSINESS-ADDRESS>
<STREET1>300 ATLANTIC ST
<STREET2>STE 702
<CITY>STAMFORD
<STATE>CT
<ZIP>06901
<PHONE>2033277050
</BUSINESS-ADDRESS>
<MAIL-ADDRESS>
<STREET1>300 ATLANTIC ST
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<ZIP>06901
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<TYPE>8-K
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<FILENAME>body.txt
<DESCRIPTION>CLEAN DIESEL TECHNOLOGIES 8-K 01-19-2006
<TEXT>
                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549



                                    FORM 8-K

                                 CURRENT REPORT
                     PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

Date of report (Date of earliest event reported): JANUARY 19, 2006.


                         CLEAN DIESEL TECHNOLOGIES, INC.
               (Exact Name of Registrant as Specified in Charter)


DELAWARE                          000-27432                     06-1393453
(State or other                  (Commission                  (IRS Employer
Jurisdiction of                  File Number)               Identification No.)
Incorporation)

                         SUITE 702, 300 ATLANTIC STREET
                                STAMFORD CT 06901
                                 (203) 327-7050
          (Address and Telephone Number of Principal Executive Offices)

Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (See General Instruction A.2. below):

[ ]  Written  communications  pursuant  to  Rule  425  under  the Securities Act
     (17 CFR 230.425)

[ ]  Soliciting  material  pursuant  to  Rule  14a-12 under the Exchange Act (17
     CFR 240.14a-12)

[ }  Pre-commencement  communications  pursuant  to  Rule  14d-2(b)  under  the
     Exchange Act (17 CFR240.14d-2(b))

[ ]  Pre-commencement  communications  pursuant  to  Rule  13e-4c  under  the
     Exchange Act (17 CFR240.13e-4 (c))


<PAGE>
                SECTION 5 - - CORPORATE GOVERNANCE AND MANAGEMENT

ITEM 5.02 DEPARTURE OF DIRECTORS OR PRINCIPAL OFFICERS; ELECTION OF DIRECTORS;
APPOINTMENT OF PRINCIPAL OFFICERS.

     (b) James M. Valentine, formerly President and Chief Operating Officer of
the Registrant, was released from his employment with, and resigned as an
officer and director of, the Registrant on January 19, 2006.

     Pursuant to the terms of a Separation Agreement of January 20, 2006 and an
Employment Agreement of September 12, 1997 (for a term commencing August 1,
1996), Mr. Valentine is entitled to salary continuation at the rate of
$27,037.50 monthly and benefits for a period of up to one year. Also, pursuant
to the terms of his outstanding option agreements, Mr. Valentine may acquire for
up to five years up to 470,719 shares of the Registrant's common stock at
exercise prices ranging from $0.90 to $4.625 per share.

     Further details of Mr. Valentine's Separation and Employment Agreements may
be found in exhibits 99.1 and 99.2 to this Report.

ITEM 8.01 OTHER EVENTS.

     On January 23, 2006 the Registrant issued the press release attached as
Exhibit 99.3 to this Report which describes certain other changes in the
Registrant's management responsibilities not involving the departure of officers
or the appointment of new officers or any changes in compensation. In addition,
the position of Chief Operating Officer was eliminated.


                 SECTION 9 - - FINANCIAL STATEMENTS AND EXHIBITS

     (c)  Exhibits

          99.1 Separation Agreement of January 19, 2006 between James M.
          Valentine and Registrant.

          99.2 Employment Agreement of September 12, 1997 between James M.
          Valentine and Registrant filed August 7, 1998 as an exhibit to
          Registrant's Form S-1 and incorporated herein by reference.

          99.3 Press Release of January 23, 2006 issued by Registrant

                                   SIGNATURES


     Pursuant to the requirements of the Securities and Exchange Act of 1934,
the Registrant has duly caused this Report to be signed on its behalf by the
undersigned hereunto duly authorized.

                                         CLEAN DIESEL TECHNOLOGIES, INC.


Date: January 25, 2006                      By /s/ C. W. Grinnell
                                            Charles W. Grinnell
                                            Vice President & Secretary


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.1
<SEQUENCE>2
<FILENAME>ex99_1.txt
<DESCRIPTION>EXHIBIT 99.1
<TEXT>
Exhibit 99.1

                              SEPARATION AGREEMENT
                                   AND RELEASE

     This  will  acknowledge  the  termination  of  the  employment  of James M.
Valentine  (hereinafter  referred  to as "You," "Your" or "Employee") with Clean
Diesel  Technologies,  Inc.  (hereinafter  referred  to as "Employer") effective
January  19,  2006  and  will  set  forth  the  terms  and  conditions  of  your
termination.  You  agree to furnish the Employer with a letter of resignation of
even  date  herewith  in  the  form  attached  to  this  Agreement as Exhibit A.
Notwithstanding  the  letter of resignation, this termination is pursuant to the
Company  termination  provisions  of  paragraph  5  c  of  your  August  1, 1996
employment agreement (the "Employment Agreement"). This Agreement is intended by
the parties to avoid the difficulties and vexation of litigation. This Agreement
is  not  intended  to  rescind  or  diminish  your  rights under your Employment
Agreement,  the  terms and conditions of any of your vested option agreements or
the  March  15,  1997  CDT-4  Agreement,  provided  that  Employer disclaims any
financial  obligations  under the CDT-4 Agreement, including with respect to the
patent  estate  related  thereto,  absent  Employer's  further  written consent,
provided  further that Employer agrees to assign said patent to you upon request
for  a  payment  of  $100.

          1.  Employer  agrees  to  provide  you  with  up to 52 weeks of salary
     continuation  paid  bi-weekly  (less  applicable deductions and withholding
     taxes)  and benefits, based on your salary in effect as of the date of your
     termination,  pursuant to and subject to the terms of paragraph 5 c of your
     Employment  Agreement  with  the  Employer,  such  salary  continuation  to
     commence  on the date of your termination. You will make yourself available
     to Employer's representatives for phone discussions on a mutually agreeable
     basis for not more than a total of twelve (12)


<PAGE>
     hours  in  the  first  thirty  (30) days of your salary continuation period
     for  advice  and  information  relating  to  your  activities  during  your
     employment.  Your  occasional  unavailability,  or  inability  to  answer
     questions,  shall  not impact your rights under this Agreement. Your vested
     options  are set out on Schedule A. Your vested options shall remain vested
     and  exercisable after your termination for the lesser of five (5) years or
     the  remaining  life  of  the  option. The details of your compensation and
     benefits  are:  annual  salary $ 324,450 - and benefits include medical and
     dental  for  employee  and  family with $20.00 - contribution semi-monthly,
     life  and  disability insurance for employee. In addition, as consideration
     for  this  Agreement  you  shall  be  given  a  non-qualified  stock option
     agreement  evidencing  your  40,000 December 20, 2005 option grant of which
     the  parties  agree  that you shall only be fully vested in and entitled to
     acquire  13,333  shares of Employer's common stock at the exercise price of
     $1.02  per share expiring at the close of business on December 19, 2010 and
     that 26,667 shares of such option shall lapse upon your resignation and may
     not be exercised. Your COBRA rights shall continue for eighteen (18) months
     after  the  termination  of  your  salary  continuation.  Your  401(k) Plan
     participation  and match shall terminate upon your resignation but Employer
     shall  assist  you  in  rolling over your 401(k) account to another plan or
     account.  Your  automobile allowance terminated effective December 31, 2005
     as  with  all  other employees. Employer shall assist you as best it can in
     transferring your Employer cell number and account to your own account. You
     will submit your final expense account for approval as soon as possible and
     Employer  shall  reimburse  you in due course. You will furnish us with the
     completed  January  3,  2006  update  to  the  November  14,  2005  revenue
     assumptions and projections as promptly as possible.


<PAGE>
          2. You affirm that your leaving Employer is not prompted or occasioned
     by  any act or attitude of discrimination by Employer, its past and present
     and  future  parent  corporations,  and  its  past  and  present and future
     divisions,  subdivisions,  affiliates  and  related  companies  and  their
     successors  and  assigns  and  all  past  and present and future directors,
     officers,  employees  and  agents,  personally, and as directors, officers,
     employees and agents of these entities. You covenant not to make any claims
     of  any  kind  against  Employer  (other  than  for  enforcement  of  this
     Agreement),  its  past  and  present and future parent corporations and its
     past and present and future divisions, subdivisions, affiliates and related
     companies  and their successors and assigns and/or any past and present and
     future  directors,  officers,  employees  or  agents,  personally,  and  as
     directors,  officers,  employees  and  agents,  before any agency, court or
     other  forum  and  release Employer, its past and present and future parent
     corporations,  and its past and present and future divisions, subdivisions,
     affiliates,  and related companies and their successors and assigns and all
     past  and  present  and  future  directors, officers, employees and agents,
     personally,  and  as directors, officers, employees and agents, personally,
     and as directors, officers, employees and agents from any and all liability
     from  any  claims under common law or under federal or state constitutions,
     statutes,  laws  or  regulations,  or  municipal  ordinances or regulations
     including but not limited to, the Connecticut Fair Employment Practice Act,
     C.G.S.  Sec.46a-51  et  seq., Title VII of the Civil Rights Act of 1964, as
                         --  ---
     amended,  42  U.S.C. Sec.2000e et seq., Sections 1981 through 1988 of Title
                                    -- ---
     42  of  the  United  States  Code,  the  Equal  Pay  Act of 1963, 29 U.S.C.
     Sec.206(d),  the  Age Discrimination in Employment Act of 1967, as amended,
     29 U.S.C. Sec.621 et seq., the Americans with Disabilities Act, as amended,
                       -- ---
     42 U.S.C. Sec.12101 et seq., the
                         -- ---


<PAGE>
     Employee  Retirement  Income  Security  Act  of 1974, as amended, 29 U.S.C.
     Sec.1001  et seq., for any reason whatsoever, arising out of you employment
               -- ---
     and  separation therefrom by Employer, up to and including the date of this
     Release  and  Agreement.  Employer  hereby  releases  you  of  and from any
     liability for your acts and omissions during your employment with Employer,
     covenants  not  to bring any claims against you for such liability and will
     indemnify  you  as  a  former  officer and director of the Company from the
     costs  and expenses involved in any action brought by third parties against
     you  relating  to  your employment with Employer, consistent, however, with
     the Employer's authority to do so under Delaware law and the Certificate of
     Incorporation of the Company.

          3.  You  further  agree that you shall abide by the provisions of your
     Employment  Agreement  regarding  intellectual property and proprietary and
     confidential  information of Employer. You agree that paragraphs 6, 7 and 8
     of  your  employment  agreement  shall  continue  according  to their terms
     following the termination of your employment.

          4.  You  also  represent that you were given a copy of this Release at
     your  termination  meeting  on  January  19, 2006 and that you shall have a
     period  of  up to 21 days thereafter in which to consider the terms of this
     Release.  Employee  also  represents  that  if he/she elects to accept this
     Release,  he/she understands that he/she will have seven (7) days following
     its  execution  to  revoke  this  Release  by  written  notification.  This
     Separation  Agreement  and Release will not become effective or enforceable
     until the expiration of the seven (7) day revocation period.


<PAGE>
          5.  You  recognize  and  agree  that this Agreement is not intended to
     imply  any  wrongdoing  on  the part of you or on the part of Employer with
     respect  to  your  employment  or  its termination and shall not constitute
     evidence of the same.

          6.  All  parties  to  this Agreement will maintain as confidential all
     terms and conditions of this Agreement.

          7.  The provisions of this Agreement shall be deemed severable, and in
     the event of a finding of invalidity or unenforceability of any one or more
     of  its  provisions shall not affect the validity and enforceability of the
     other provisions.

          8.  The  terms  of this Agreement cannot be changed or modified in any
     respect except in writing signed by both parties hereto.

          9.  You  and  Employer mutually agree that this Release represents the
     full  and  entire  agreement between the parties and supersedes any and all
     prior  agreements  (with  the  exception  of your August 1, 1996 employment
     agreement)  or  discussions  between  the  parties  with  respect  to  the
     termination of your employment with Employer.


<PAGE>
          10. You and Employer mutually agree not to disparage each other in any
     way.  You  agree  to  refer customers and other third parties communicating
     with  you  on matters relating to Employer's business occurring during your
     employment to Walter Copan.

          11.  You  agree  to  resign  from  the  Employer's  Board of Directors
     effective  upon  the  end of the seven day revocation period (which will be
     the effective date of your resignation).

          12.  You  agree, pursuant to paragraph 7 of your employment agreement,
     to  promptly  return  all proprietary information in your possession to the
     Employer.

          13.  You  agree  to  promptly  return  all  Company  property  in your
     possession  to  the employer. You may, however, retain the Company computer
     in  your  possession. You acknowledge that you have read the aforementioned
     carefully  and  fully  understand its terms. You have had an opportunity to
     consult  with  counsel  and  you are executing this Release voluntarily and
     knowingly.  I  understand  and hereby agree to the terms of this Separation
     Agreement and Release.


/s/  James  M. Valentine                            Date:     January 19, 2006
Employee


/s/  Bernhard  Steiner                              Date:     January 19, 2006
Employer


<PAGE>
                                 ACKNOWLEDGMENT
                                 --------------

     I  hereby acknowledge that I have been given the opportunity for seven days
to revoke the Release relating to my termination of employment that I had signed
and  returned  to  Employer  and  have  decided  not  to  revoke  that  Release.



/s/  James M. Valentine                             Date:     January 26, 2006
Employee


<PAGE>
                                    EXHIBIT A


                                                       January 19, 2006



To:   Derek R. Gray
      Chairman of the Board
      Clean Diesel Technologies, Inc.

cc:   Bernhard Steiner
      CEO
      Clean Diesel Technologies, Inc.

From: James M. Valentine


     In  accordance  with  the  terms  of my Separation Agreement and Release, I
hereby resign as an employee, officer and director of Clean Diesel Technologies,
Inc.  with  immediate  effect.



                                                  Sincerely,



                                                  /s/ James M. Valentine
                                                  James M. Valentine


<PAGE>
<TABLE>
<CAPTION>
                                    SCHEDULE A


CLEAN DIESEL
TECHNOLOGIES, INC.                                     Schedule A
COMMON STOCK
OPTIONS                            Jim Valentine



                                         2005                     OUTSTANDING
                      EXERCISE         ACTIVITY                    @ 12/31/05
                                       ------------------------------------------
              GRANT                                                         NON-
            ---------                                                      ------
NAME          DATE     PRICE  GRANTED  VESTED  LAPSED  EXERCISED  VESTED   VESTED
----------  ---------  -----  -------  ------  ------  ---------  -------  ------
<S>         <C>        <C>    <C>      <C>     <C>     <C>        <C>      <C>
              17-Mar-
Valentine        94    0.200   25,000                                   0       0
Valentine   28-Oct-94  2.000   25,000                                   0       0
Valentine     26-Dec-
                 95    6.820   10,000          10,000                   0       0

Valentine    6-Feb-97  4.625   10,000                              10,000       0
Valentine
             6-Feb-97  4.625   25,000                              25,000       0
Valentine    5-Jun-98  2.000    7,500                               7,500       0
Valentine   14-Jun-99  0.900   60,000                      2,000   29,885       0
             10-Feb-
Valentine       00     2.500   75,000                              75,000       0
              14-Mar-
Valentine       01     1.965   60,000                              60,000       0
              13-Mar-
Valentine       02     2.900  100,000                             100,000       0
Valentine   11-Jun-03  1.650   80,000  26,667                      80,000       0
Valentine    2-Dec-03  3.070   40,000  13,334                      40,000       0
Valentine    9-Dec-04  1.940   30,000  20,000                      30,000       0
              20-Dec-
Valentine       05      1.02   40,000  13,333                      13,333  26,667

                                                                  -------  ------
                              587,500                             470,719  26,666
</TABLE>


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.3
<SEQUENCE>3
<FILENAME>ex99_3.txt
<DESCRIPTION>EXHIBIT 99_3
<TEXT>
Exhibit 99.3


<TABLE>
<CAPTION>
NEWS RELEASE FOR JANUARY 23, 2006 AT 2:30 AM EST AND 7:30 AM GMT
----------------------------------------------------------------
<S>       <C>                                       <C>
Contact: ALLEN & CARON INC               or        CLEAN DIESEL TECHNOLOGIES, INC.
         Jesse E. Deal (US  investors)             David  W.  Whitwell,  CFO
         (212) 691-8087; jesse@allencaron.com      (203) 327-7050; dwhitwell@cdti.com
         Len Hall (US  media)
         (949) 474-4300; len@allencaron.com

         ABCHURCH COMMUNICATIONS
         Heather Salmond (UK investors) +44 (0) 20 7398 7700
         heather.salmond@abchurch-group.com
</TABLE>

             CLEAN DIESEL TECHNOLOGIES ANNOUNCES MANAGEMENT CHANGES


STAMFORD, CT (JANUARY 23, 2006)   Clean Diesel Technologies, Inc. (EBB:CDTI &
AIM:CDT/CDTS), a developer of chemical and technological solutions to reduce
harmful engine emissions, announced today a series of management changes, all
effective immediately, to bolster its operations for growth that is anticipated
as its emission control technologies and products are approaching wider
acceptance among market influentials and regulators.

     Dr. Bernhard Steiner, Chief Executive Officer, has been appointed to the
additional post of President.  Dr. Walter Copan, formerly Vice President and
Chief Technology Officer, will now serve as Executive Vice President / North
American Operations in addition to his continued worldwide technology
responsibilities.  North American sales, marketing and engineering will report
to Dr. Copan.  Glen Reid remains Vice President / Sales and Marketing, and
reports to
Dr. Copan.

     David Whitwell, Chief Financial Officer since 1999, becomes both CFO and
Senior Vice President / Administration, with global responsibility for material
management, distribution and human resources in addition to finance and
accounting for both the North American and international operations.

     Tim Rogers, formerly Vice President/International, is now Executive Vice
President / International Operations, responsible for sales and marketing in
Europe and Asia.  Mr. Rogers, Dr. Copan and Mr. Whitwell all continue to report
to Dr. Steiner.

     Clean Diesel announced that it had released James M. Valentine from
employment as President and Chief Operating Officer effective immediately. The
Company also said that Mr. Valentine had resigned as a director of the Company.

     Dr. Steiner stated the separation between Clean Diesel and Mr. Valentine
was amicable and Mr. Valentine had left to pursue other interests. Dr. Steiner
acknowledged, "Mr. Valentine has made many contributions during his years of
service to Clean Diesel; we thank him for his role in developing its
technologies and the management, and the Board and the Company wish Jim well as
he pursues new opportunities."

                                 MORE-MORE-MORE


<PAGE>
CLEAN DIESEL ANNOUNCES MANAGEMENT CHANGES
Page 2-2-2

     Dr. Steiner added that, "We are very optimistic about our 2006
opportunities in the United States, Europe and Asia.  Funding for retrofit
emission programs is moving forward in the marketplace and our Platinum Plus
fuel-borne catalyst, ARIS 2000 selective catalyst reduction, wire-mesh diesel
particulate filter and EGR-SCR technologies are rapidly gaining recognition and
acceptance with regulators, fuel distributors, vehicle manufacturers and
tier-one automotive
supply companies."

About Clean Diesel Technologies, Inc.
-------------------------------------
     Clean Diesel Technologies, Inc. and its UK representative office, Clean
Diesel International LLC, is a developer of chemical and technological solutions
to reduce harmful engine emissions.  Clean Diesel Technologies has patented
products that reduce emissions from combustion engines while simultaneously
improving fuel economy and power.  Products include Platinum Plus(R) fuel borne
catalysts, the Platinum Plus Purifier System and the ARIS(R) 2000 urea injection
systems for selective catalytic reduction of NOx.  Platinum Plus and ARIS are
registered trademarks of Clean Diesel Technologies, Inc.  For more information,
visit CDT at www.cdti.com or contact the Company directly.

     Certain statements in this news release constitute "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995.  Such forward-looking statements involve known or unknown risks,
including those detailed in the Company's filings with the Securities and
Exchange Commission, uncertainties and other factors which may cause the actual
results, performance or achievements of the Company, or industry results, to be
materially different from any future results, performance or achievements
expressed or implied by such forward-looking statements.  Readers are cautioned
not to place undue reliance on these forward-looking statements, which speak
only as of the date hereof.

                                     # # # #

</TEXT>
</DOCUMENT>
</SUBMISSION>
