Exhaust Gas Recirculation (EGR) is a frequently used technique to reduce the production of NOx. The effect of EGR on the early flame evolution, two-stage ignition process and spray flame structures for n-heptane spray flames are investigated using large eddy simulation. The two-stage ignition process is identified based on the formation of key species and early heat release process. Results demonstrate that a longer ignition delay (ID) and flame lift-off length (LOL) under lower oxygen concentration conditions could increase the mixing time for fuel and air. However, the first-stage ignition still initiates in fuel-richer regions for the cases with higher EGR rates due to the lack of oxygen. In contrast, compared to the case with the same initial oxygen content but at a higher gas temperature of 1000 K, the first-stage ignition moves to stoichiometric mixture fraction regions at 900 K. The combustion mode analysis based on hydroxyl and formaldehyde is conducted to distinguish between the low- and high-temperature combustion regions. Most importantly, to study the stabilization mechanism, the chemical explosive mode analysis (CEMA) is conducted based on analysis on the local flow time scale and the chemical time scale. During the early stage of ignition, a balance between reaction and mixing implies that cool flame propagates from the ignition spots through the entire flow field. And during the quasi-steady state, autoignition plays a dominant role.