The Institute of Internal Combustion Engines and Thermodynamics at Graz University of Technology has developed a low-pressure (5 bar) direct injection (LPDI) combustion system for 50 cm₃ two-stroke engines during the last years. The 50 cm₃ two-stroke engine is a specific European engine class. Worldwide the 125 cm₃ class is more important. In order to investigate the potential of higher displacement engines equipped with the LPDI combustion process, a demonstrator engine with 250 cm₃ has been developed. The results of this demonstrator from the engine test bench and from the chassis dynamometer are discussed to show the potential of this two-stroke technology. In order to ease the interpretation, the results of a homogenously scavenged two-stroke engine and of a naturally aspirated four-stroke engine serve as reference.The results show that the LPDI technology is a real alternative to expensive four-stroke engines. The high efficiency and the very low emissions are of special interest for the consumption-sensitive Indian market, especially in high population urban areas with big problems due to high air pollution.