This thread is from 2001. It was a cracked head as I recall.

I went through all of this and replaced everything (raditor, temp sensor, water pump, fan clutch) and still the temp would go up over 100c. Than I ran into a mb tech on the golf course and he had me check the wiring from temp sensor to the cluster. I soldered a new end on the temp sensor AND ran a new ground from the cluster (back of temp guage) to the body. Now the car runs at constant 90 t 95c and I live in south florida. The ground was the last thing that I did and that solved the problem.

Overheat Engine
 

1984 300d Turbo 135k
Take The Top Radaitor Hose Off Fill To Top, You Have Air In The System Had The Same After I Change My Radiator And Replace Or Clean The Bypass Small Line On Front Use New Copper Seal Washers, A Kit From Jc Whitney.com Also Rubber O Ring Metic Kit One Fit The Leaking Alda

You are not really too hot
 

First, you need to relax. 100 Deg-C on an 84 300D is really not that hot. I have owned several of these models and over 250k miles or so they tend to run around 100 Deg-C. The issue is probably not with the coolant system anyway. In these vehilces, unless you have an obvious problem with the cooling system, running too hot is usually a sympton of poor combustion. I recommend adjusting your valves and see what happens. This is a fairly easy job for a DIY-er, but you will need the special wrenches and a good set of feeler gauges. Replace the valve cover gasket as part of the job. The next thing I would try is running some "Diesel Purge" through the fuel system, or better yet, have your injectors professionally cleaned (this is a lot more $$$). I bet you engine smokes a little on acceleration. That's another indication of poor combustion. But don't worry about 100 Deg-C. Until you start to get up to about 120, you will not damage the engine.

Check out the diesel forum for guys who know more than I about this.