The continued demands of improving fuel economy while maintaining or improving vehicle performance and emissions is the driving force behind new powertrain control features. This paper describes a Model-in-the-Loop (MIL) environment, which is used in the development of advanced powertrain control systems. The MIL is a cost effective and convenient tool for testing the control implications of new features such as, variable valve timing (VVT), variable valve lift (VVL), gasoline direct injection (GDI), etc. It is also helpful in testing the effects of different calibrations and powertrain configurations prior to implementing them on a vehicle or test bench. The overall structure of the MIL includes a control module, vehicle plant models, and signal display blocks. Each of these will be described with the focus being on the plant models and the overall MIL environment.