The closed cycle diesel propulsion system is free from the problem of the intake air, exhaust gas and their control that are associated with the conventional diesel propulsion system. The system is composed of a main engine, an exhaust cooler. a $CO_2$ scrubber and a $O_2$ mixer. In this paper, a hardware using microprocessor is proposed in order to monitor and control the oxygen and ratio of specific heat for underwater diesel propulsion system. Also simulation is carried out to ascertain the performance of proposed system.