Abstract: A lubricant or lubricant additive composed of halogen-, phosphorus- and sulphur-free ionic liquids containing fatty acid anions exhibit superior friction-reducing and anti-wear properties. Preferably, the lubricant composition comprises a base oil and an ionic liquid or mixed of two or more ionic liquids having concentration of 0.5 wt. % or more. These halogen-, phosphorus- and sulphur-free ionic liquids as lubricant or lubricant additive have minimal hazardous and corrosion effect to the environment and engineering surfaces, respectively. General chemical formula of fatty acid anion is represented as RCOO?; whereas R may be C4 to C30 straight chain alkyl, branched alkyl, cycloalkyl, alkyl substituted cycloalkyl, cycloalkyl substituted alkyl, alkenyl (single or more double bonds) includes with or without branched structure and may contain heteroatom.