Peter Dearman converted the engine on his 25-year-old Vauxhall Nova to only powered only by liquid air, ABC News reported.
"We're starting to run out of fossil fuels now. We've got to do something," said Dearman. "Hopefully this offers a solution."
In his engine, "the liquid air boils and creates a pressure that forces the piston down. As the piston goes down, the gas expands and cools -- but it's able to absorb more heat from the heat exchange fluid, making it much more efficient," Dearman said.
Dearman said he believes he may have created the world's most efficient car.
"Everything that's used in here can be recycled very easily," he said. "Very little energy goes into actually producing the car. So the car is very cheap."
The inventor said he hopes that by next year, there is a car designed around his engine.
"I've done sort of the basic work, and they're going to refine it and bring it onto the next stage for us," he said.