Emission regulatory bodies and government agencies focus on reducing tailpipe emissions from internal combustion engines. This can be achieved by introducing E-fuel to internal combustion engines and moving towards hybrid electric vehicles. E-fuel is produced using atmospheric carbon dioxide or carbon dioxide from thermal power plants/industrial sources. The E-fuel family comprises various candidates such as E-Methanol, E-DME, E-Hydrogen, and E-Ammonia. Hybrid electric vehicles provide better fuel economy and reduce tailpipe emissions, which is the utmost requirement at the current stage for all countries. The E-fuel-driven internal combustion engine combinations with electric motors powered by a charged battery pack, which can quickly charge the on-board generator. Also, it enables a regenerative braking system to power the transmission. Hybrid electric vehicles combine internal combustion engines, which are fuelled by E-Fuel, with electric motors and power electronic equipment. The comprehensive information about various hybrid configurations and their control strategies is also discussed. The dedicated section discussed E-Hydrogen-hybrid electric vehicles, E-Methanol-hybrid electric vehicles, E-DME-hybrid electric vehicles, and E-ammonia-hybrid electric vehicles. At the end of the sections, challenges, recommendations, and future scope for E-Fuel Production, E-Fuel utilisation and hybrid electric vehicles are elaborated.