This paper deals with an advanced electro-hydraulic power steering (EHPS) system compactly integrating a hydraulic pump with an electric motor, a steering gearbox with a center-closed servo valve and an accumulator. In this EHPS system, the hydraulic pump with an electronically controlled motor works only during steering operation. Stopping the hydraulic pump during non-steering operation is extremely effective for reducing energy consumption in power steering because steering operations are infrequent. The EHPS system described in this paper is suitable for pollution free vehicles such as electric vehicle having no engine-driven accessories and has the advantages of reduced power consumption and ease of installation. This EHPS system may be also used for engine-driven vehicles and has been tested on a conventional gasoline engine vehicle with an 810 kg front weight. Test results demonstrate its effectiveness.