Low viscosity engine oil API SN 0W-16 was developed to achieve 0.5 % fuel efficiency improvement compared to our current GF-5/API SN 0W-20. In low viscosity engine oil, oil consumption and engine wear are main roadblocks. However, optimization of base oil and additives realized to prevent oil consumption and wear. Firstly, it was confirmed in engine test that NOACK volatility is still one of the effective indicators for oil consumption even in low viscosity grade like 0W-16. As a result of base oil volatility control, oil consumption in developed oil could be the same level as current GF-5/API SN 0W-20. Secondary, it was found that base oil viscosity and MoDTC had significant effect on chain wear in rig testing which simulated silent chain wear. In case of same base oil viscosity, same oil film thickness can be maintained at high surface pressure. The same base oil as current GF-5 0W-20 was selected to keep the oil film thickness. The viscosity was adjusted by reducing Viscosity Modifier. Additionally, anti-wear performance of MoDTC was confirmed not only in fresh oil but also in aged oils which were collected from an actual vehicle test. MoDTC can reduce friction and wear in fresh oilt. But aged oils showed high friction and low wear. This indicates that some components based on decomposed MoDTC don’t have low friction effect but they can reduce wear. As a result of base oil and additive optimization, anti-wear performance in developed oil could be secured and showed much better than higher viscosity of experienced GF-4 5W-30.