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Current political and environmental concerns are driving renewed efforts to develop techniques for improving the efficiency of internal combustion engines. A detailed thermodynamic analysis of an engine and its components from a 1st and 2nd Law perspective is necessary to characterize system losses and to identify efficiency opportunities. We have developed a method for performing this analysis using simulation results from commercially available engine-modeling software packages such as WAVE® from Ricardo, Inc., and GT-Power™ from Gamma Technologies, Inc. Results from the simulation are post-processed to compute thermodynamic properties such as internal energy, enthalpy, entropy, and availability (or exergy) which are required to perform energy and availability balances for the system. This analysis is performed for all major engine components (turbocharger, intercooler, EGR cooler, etc.) and for the engine as a whole as a function of crank angle over an entire engine cycle.