This paper proposed a control method of vehicle lateral stability control system. In order to obtain the best driving performance under the complicated friction conditions track, the direct yaw moment (DYC) and the engine torque regulation (ETC) value need to be adjusted to avoid penalisation of each other. Firstly, the intervention timing of direct yaw moment control and engine torque regulation control is studied, which is judged by the phase plane method and longitudinal speed threshold method, respectively. Then, a direct yaw moment control algorithm based on sliding mode control algorithm is designed, and its target value calculation depends on the linear two-degree-of-freedom model. The engine torque regulation is calculated by fuzzy algorithm. The input values are mainly the vehicle state parameters and the driver’s input to the steering wheel. Matlab/Simulink, AMESim, and CarSim software programs are used to simulate sine with dwell maneuver. The simulation results show the effectiveness of the cooperation control algorithm proposed in this paper.