This paper describes the use of advanced vehicle research projects in a multidisciplinary capstone design laboratory course offered in the Electrical and Mechanical Engineering Departments at Texas Tech University. The course uses projects from industry, research efforts and other faculty initiatives. A number of research projects involving alternative fuel and hybrid electric vehicles are used in the senior project laboratory. These projects involve essentially all aspects of automobile subsystems design and fabrication including internal combustion engine (ICE) fuel metering and control, hybrid vehicle (ICE/electric motor) control, structures, fluids, heating and air conditioning, vehicle suspension, transmission, brakes, electrical subsystems, advanced system control and electronics. Although the project team is frequently large, the students do an outstanding job of integrating their efforts and coming together as a truly effective working unit.