Two-stroke diesel engines could be a promising solution for reducing carbon dioxide (CO2) emissions from light-duty vehicles. The main objective of this study was to assess the potential of two-stroke diesel engines in achieving a substantial reduction in CO2 emissions compared to four-stroke diesel baselines in conventional and hybrid electric light-duty vehicles. As part of this study 1-D models were developed for loop scavenged two-stroke and opposed piston two-stroke diesel engine concepts. Based on the engine models and an in-house vehicle model, projections were made for the CO2 emissions from two representative vehicle configurations - a conventional light-duty vehicle and a light-duty hybrid electric vehicle, over the US FTP-72 (Federal Test Procedure) Cycle and the Highway Fuel Economy Test (HWFET). The composite CO2 emissions for the conventional light-duty vehicle over the two cycles with a loop scavenged two-stroke engine were 4% lower compared to a state of the art four-stroke diesel engine, while the opposed piston diesel engine had about 8% potential benefit. Opposed piston two-stroke engines offer the potential for even higher thermal efficiency than loop scavenged two-stroke engines. The efficiency advantages of the opposed piston two-stroke engine are mainly because of lower in-cylinder heat losses due to elimination of the cylinder head and lower surface area to volume ratio. For the light-duty hybrid electric vehicle, the composite CO2 emissions over the two drive cycles with a loop scavenged two-stroke engine were 5% lower compared to the four-stroke diesel baseline, while the opposed piston diesel engine had about 9% potential benefit. Whether the theoretical benefit translates to actual CO2 emissions reduction will have to be verified experimentally.