The idea of hybrid vehicles is not a recent development; as early as the 1960s, several have companies attempted to develop bipolar lead/acid batteries for hybrid-electric vehicles [J.L. Arias, J.J. Rowlett, E.D. Drake, Journal of Power Sources, 40 (1993) 63–73.]. Hybrid vehicles have the potential to increase fuel economy by using a primary engine operating at a constant power to supply average power requirements and a surge power unit for peak power demands and to recover braking energy. To date, no detailed system optimization analysis has been performed for hybrid vehicles. This study combines a simplified version of the lithium-ion battery model developed by Doyle [C.M. Doyle, Design and simulation of lithium rechargeable batteries, Dissertation, Fall, 1995.] with a vehicle model that determines battery-power requirements for a given driving cycle. Batteries are designed for either the highest vehicle mileage or minimal acceptable battery dimensions. Hybrid vehicles have the potential to more than double mileage as compared to conventional vehicles, and have a limited electric vehicle range. The battery goals of the Partnership for a New Generation of Vehicles (PNGV) are investigated and often found to be differing with actual requirements. Specifically, PNGV overstates power and especially energy requirements for load-leveling devices and calls for unnecessary demands on the development of alternate technologies. The role of the driving cycle was investigated and found to be relatively unimportant as long as it contains several essential features. The important parameters in the driving cycle are the time of discharge and the maximum current (or power) level. This study suggests that a combination of both a vehicle model and a battery model is required to determine the complex interaction between hybrid-vehicle weight and battery power.