Additional data has been analyzed on the effect of engine size on thermal efficiency. The comparison has been expanded to show the trends separately for engines developed by several different manufacturers. The data confirm the conclusion that engines below 2.0 liters per cylinder seem to deteriorate in fuel economy faster than would have been predicted from the behavior of larger engines. It is postulated that such deterioration results from a combination of less than optimum fuel spray, wall wetting, and perhaps a greater heat transfer loss than was anticipated. The paper focuses on engines in the size range under two liters per cylinder and addresses some of the problems to be resolved. Means for generating and controlling fuel spray and injection rate shape are presented along with experimental data on fuel sprays and engine combustion. The conclusion is that combustion of medium and small size engines can be substantially improved by avoiding wall wetting yet maintaining fast burn rate through high pressure, short duration fuel injection. Front end injection rate shaping can eliminate the adverse effects of ignition delay.