The Senegal international made his debut for the west Yorkshire club in the League Cup on Saturday, and the Whites boss hopes he can have an impact at Elland Road
Diouf signed for the Whites on a non-contract basis and made his debut for the Championship side in their League Cup 4-0 win over Shrewsbury Town on Saturday.
The 63-year-old believes that, despite having disagreements with the Senegal international in the past, the winger has a lot to offer both on and off the football pitch.
"I met him about six or seven weeks ago," Warnock told Yorkshire Radio.
"It wasn't a planned meeting, but we ended up having an hour-and-a-half chat and I told him what I disliked about him and he talked to me about the things that he's done in football.
"It opened my eyes in what I thought about him and nobody has said worse things about him than I have. It would have been easy for me not to bring him to the club but I've never been one to shirk a situation
"A friend of mine, Micky Walker, who was at Doncaster Rovers, couldn't speak highly enough of him. He said he's good in the dressing room, he's excellent with the youngsters, and is a bit of a likeable rogue. And he told me his weaknesses."
Warnock also admitted that the fact Diouf was available as a free agent meant the club had nothing to lose.
He added: "We're also short on the right-hand side.
"There's a not a lot of money without moving players out - there's a couple of Premiership lads I've looked at, but they're on a lot of money - so I thought we'd have a look."