Dimethyl ether (DME) can be synthesized from natural gas and is suited for use as an automotive fuel since it forms a liquid at normal temperatures and low pressures. DME is usable as fuel of the diesel engine because the cetane number of DME is almost same as that of diesel oil. In addition, by partially improving the fuel injection system of a diesel engine, an engine powered by DME can achieve the same performance and specific fuel consumption as the base diesel engine. Because DME is pure substance with constant fuel composition, in comparison with the diesel oil, DME can control dispersion of ignition timing and can prevent the deterioration of after-treatment device caused by the sulfur component. And also for fuel characteristics of DME which has no carbon-carbon bond with oxygenated fuel, it generates virtually zero PM emissions, which eliminates the need for a diesel particulate filter (DPF). Moreover, DME has a low carbon content (carbon/hydrogen ratio: 0.33), and produces less CO2 during its production than diesel synthesized from natural gas by the Fischer-Tropsch (FT) process. This paper describes the results obtained from DME vehicles developed under the national project named EFV21, the public road testing program, the progress of studies into draft technical standards, the outlook for the production and supply of DME fuel, and the strategy for Popularizing vehicles fueled by DME in the future.