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The majority of on-road vehicles today are powered by internal combustion engines, which are, in most cases, burning petroleum-derived liquid fuels mixed with bio-components. The power to weight ratio of internal combustion engines combined with the high energy content of conventional fuels, which can be refilled easily in matter of minutes, makes them ideal for all kinds of road transportation. Since the introduction of EURO emissions norms, the emissions from the Transport sector in the European Union have undergone significant reduction. There are several alternatives to fossil fuels with similar properties, which can replace their usage in the Transport sector. The main focus of research in recent decades has been on biofuels, which can be produced from several sources. The production of biofuels is usually energy more intensive than production of fossil fuels, but their usage can contribute to emission reduction in the Transport sector. In recent years, a lot of effort was also put into promotion of electric vehicles as zero emissions vehicles. This statement should be reconsidered, since the greenhouse impact of electrical vehicles is not negligible. Conversely, in some cases, an electrical vehicle can have an even higher emission impact than modern vehicles with sophisticated internal combustion engines. This is characteristic for countries where the majority of the electricity is produced in coal power plants. With the decrease of greenhouse gas emissions in the Electricity Production sector, and with the increase of battery capacity, the role of electric vehicles in the Transport sector will probably increase. Despite significant research and financial investments in electric vehicles development, the transport sector in near future will be mostly powered by internal combustion engines and petroleum-derived liquid fuels. The amount of pollution from transport sector will be further regulated with stricter emission norms combined with smaller amount of alternative fuel usage.