Abstract: A closed loop fuel system (10) for an internal combustion engine (12) includes a water tank (14) in which water is electrolyzed to provide hydrogen and oxygen gases that are pressurized for storage in respective tanks (26, 30) for flow to the engine and combustion prior to exhaust flow to a condenser (40) and recycling back into the water tank. The fuel system (10) includes an auxiliary water supply (68) that lowers the burn temperature of the engine and provides additional steam under pressure for operation of the engine as well as providing cooling of the exhaust steam condensed by the condenser (40). A photovoltaic panel (52) can be used to electrolyze the water and provide the hydrogen and oxygen gases.