The diesel engine has the highest thermal efficiency of any regular internal or external combustion engine due to its very high compression ratio. Low-speed diesel engines (as used in ships and other applications where overall engine weight is relatively unimportant) can have a thermal efficiency that exceeds 50%.

Diesel engines are manufactured in two-stroke and four-stroke versions. They were originally used as a more efficient replacement for stationary steam engines. Since the 1910s they have been used in submarines and ships. Use in locomotives, trucks, heavy equipment and electric generating plants followed later. In the 1930s, they slowly began to be used in a few automobiles. Since the 1970s, the use of diesel engines in larger on-road and off-road vehicles in the USA increased. As of 2007, about 50% of all new car sales in Europe are diesel.