Experiments have been conducted on automating driving since at least the 1920s; trials began in the 1950s. The first truly automated car was developed in 1977, by Japan’s Tsukuba Mechanical Engineering Laboratory. The vehicle tracked white street markers, which were interpreted by two cameras on the vehicle, using an analog computer for signal processing. The vehicle reached speeds up to 30 kilometres per hour (19 mph), with the support of an elevated rail.

Autonomous prototype cars appeared in the 1980s, with Carnegie Mellon University’s Navlab and ALV projects funded by DARPA starting in 1984 and Mercedes-Benz and Bundeswehr University Munich’s EUREKA Prometheus Project in 1987. By 1985, the ALV had demonstrated self-driving speeds on two-lane roads of 31 kilometers per hour (19 mph) with obstacle avoidance added in 1986 and off-road driving in day and nighttime conditions by 1987. From the 1960s through the second DARPA Grand Challenge in 2005, automated vehicle research in the U.S. was primarily funded by DARPA, the US Army and the U.S. Navy yielding incremental advances in speeds, driving competence in more complex conditions, controls and sensor systems. Companies and research organizations have developed prototypes.

The U.S. allocated $650 million in 1991 for research on the National Automated Highway System, which demonstrated automated driving through a combination of automation, embedded in the highway with automated technology in vehicles and cooperative networking between the vehicles and with the highway infrastructure. The program concluded with a successful demonstration in 1997 but without clear direction or funding to implement the system on a larger scale. Partly funded by the National Automated Highway System and DARPA, the Carnegie Mellon University Navlab drove 4,584 kilometers (2,848 mi) across America in 1995, 4,501 kilometers (2,797 mi) or 98% of it autonomously. Navlab’s record achievement stood unmatched for two decades until 2015 when Delphi improved it by piloting an Audi, augmented with Delphi technology, over 5,472 kilometers (3,400 mi) through 15 states while remaining in self-driving mode 99% of the time. In 2015, the US states of Nevada, Florida, California, Virginia, and Michigan, together with Washington, D.C., allowed the testing of automated cars on public roads.

In 2017, Audi stated that its latest A8 would be automated at speeds of up to 60 kilometres per hour (37 mph) using its “Audi AI.” The driver would not have to do safety checks such as frequently gripping the steering wheel. The Audi A8 was claimed to be the first production car to reach level 3 automated driving, and Audi would be the first manufacturer to use laser scanners in addition to cameras and ultrasonic sensors for their system.

In November 2017, Waymo announced that it had begun testing driverless cars without a safety driver in the driver position; however, there is still an employee in the car. In July 2018, Waymo announced that its test vehicles had traveled in automated mode for over 8,000,000 miles (13,000,000 km), increasing by 1,000,000 miles (1,600,000 kilometers) per month.