Automobile drivetrain hybridization is considered as an important step in reducing greenhouse gases and related automotive emissions. However, current hybrid electric vehicles are a temporary solution on the way to zero emission road vehicles. Recently there has been a lot of interest in the concept of plug-in hybrid electric vehicles, which have great potential to attain higher fuel economy and efficiency, with a longer range in pure electric propulsion mode. PHEVs represent the next generation of hybrid vehicles that bridges the gap between present hybrid electric vehicles and battery operated electric vehicles. In this paper a brief review of design considerations and selection of major components for plug-in hybrid electric vehicles is provided. This paper also focuses on the technological challenges ahead of plug-in hybrid electric vehicles in relation to its major components, which are reviewed in detail. The importance of economics and government support for the successful deployment of this plug-in hybrid technology in the near future to achieve national energy security is also discussed in the paper.