Fuel efficiency is one of the most important parameters in advanced vehicles. Therefore, the measurement of fuel consumption in-situ and in real-time is obviously demanded in development and evaluation processes of new engines and vehicles. This paper describes a new concept for measuring fuel consumption in real-time, which utilizing raw exhaust gas flow rate and exhaust air-to-fuel ratio (AFR). The AFR is defined as the mass ratio of air and fuel supplied to the engine, and the mass flow rate of exhaust gas can be regarded as the summation of the mass flow rate of air and fuel. This means the fuel consumption can be calculated from exhaust flow rate and AFR.To realize in-situ, real-time measurement, we used an ultrasonic exhaust flow meter which can measure a wide flow range accurately with no pressure loss, and a fast response zirconia sensor which can be installed onto the exhaust pipe directly without any sampling system. This exhaust flow-AFR method has the advantage that the real-time fuel consumption can be easily obtained without delay time by these in-situ measuring devices which can be installed at the almost same location.Integrated fuel consumption by this method showed good correlations with conventional methods, i.e. the carbon balance method and the fuel flow method. Furthermore, in the transient tests including engine start and fuel cutting operation, it showed sufficient response for real-time analysis. The results suggest that this method has a significant potential for measuring fuel consumption in-situ and in real-time.