Self-Driving Vehicles: Overview, How They Work, Levels of Autonomy

What Are Self-Driving Vehicles?

By Kristi Waterworth – Updated Jan 20, 2026 at 11:36 AM EST | Fact-checked by Frank Bass

Key Points

Self-driving cars use cameras, sensors, and algorithms to navigate autonomously.
Levels 0-2 are driver support, while levels 3-5 offer increasing autonomy.
Investors should watch robotaxis and autonomous freight for growth potential.

For investors in the automotive space, it's important to keep up with cutting-edge technology as it develops. The self-driving vehicle is one such type of tech. These have been in production at some level for years; many with some level of autonomous driving are already on the road. Read on to learn more about how these vehicles work.

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A Waymo Jaguar sports SUV. — Image source: Getty Images.

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About the Author

Kristi Waterworth has been a contributing real estate and financial expert at The Motley Fool, covering real estate, investing, and personal finance topics, since 2020. Kristi has been interviewed by various TV media outlets and podcasts for her real estate investing expertise – from residential real estate to digital real estate and everything in between. Kristi’s journalist career spans over 25 years, and she has written about real estate investing, homeownership, and home construction specifically for the last decade. She was also previously a licensed Realtor and general building contractor before the Great Recession and housing market collapse. She holds a bachelor’s degree in American history from Columbia College in Missouri.

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