Hardware-in-the-Loop Simulation is a technology where the actual vehicles, engines or other components are replaced by a real-time simulation in a simulation computer, based on a mathematical model. That simulation reads ECU (Electronic Control Unit) output signals which would normally go to actuators. On the other hand the simulation must output the sensor signals which make the ECU ‘think’ it controls a real system. Generating these signals can be very difficult. Signals may be complex, depend on on-line computed variables, and be required to be output at high timing resolution. This paper describes the problems and presents a solution which employs high-performance Digital Signal Processors (DSP) to generate such signals on-line by Direct-Digital-Synthesis (DDS).