There has recently been considerable interest in using the sensorless permanent magnet synchronous motor (PMSM) for vehicle propulsion systems. While many sensorless PMSM techniques have been presented in the literature, few have discussed in detail the underlying hardware and implementation issues. This work focuses on the implementation and application of a sensorless PMSM strategy that is particularly well suited for vehicle propulsion systems. The selected sensorless PMSM technique is implemented in a real-time motor control system to form a sensorless electric drive prototype. The hardware, strategy and implementation issues associated with the development of the sensorless drive are discussed. Experimental results are included in order to demonstrate the robustness of the implementation and the effectiveness of the sensorless drive under transient operating conditions such as startup and speed reversal.