Stirling Thermal Motors, Inc. (STM) has been developing and testing a general purpose Stirling engine, designated the STM4-120. The engine was optimized to produce 25 kW at 1800 RPM and features a four-cycle, double-acting configuration, resulting in high specific power with variable displacement power control for high efficiency over a wide power range.During the last year, Stirling Thermal Motors, Inc. (STM) and Detroit Diesel Corporation (DDC) began a cooperative effort to develop this engine for commercial applications. This engine has demonstrated performance and fuel efficiency equivalent to a diesel with superior emission and noise characteristics. These qualities, in addition to the engine's multifuel capability and the potential for long service free life, have generated interest in manufacturing and marketing this engine for commercial applications where operating requirements are not attainable with today's diesel engine.This paper describes the key technological developments which make the STM4-120 Stirling engine suitable for commercialization. Near-term applications including industrial generator sets, marine Auxiliary Power Units (APU), generator sets for hybrid electric vehicles, and military power plants will be pursued. Later applications include solar thermal power, cogeneration systems, and cryocoolers. The development plans for one particular application, Stirling based hybrid electric buses, is discussed.