Indirect field-oriented control, direct field-oriented control, and direct torque control are the most widely used instantaneous torque control techniques for the drive system of alternative energy vehicles (AEVs). This paper evaluates three candidate alternating-current machines and investigates the suitability of different control techniques for the drive systems of battery-powered electric vehicles, hybrid electric vehicles, and integrated starter alternators. Accurate flux and torque estimation is the core of any opted control technique for all types of AEV drive systems. Therefore, an accurate closed-loop voltage model flux and torque estimator that is insensitive to stator resistance variation has been designed. This paper also analyzes loss model control and search control (SC) techniques for the drive system's efficiency optimization and proposes an offline SC efficiency optimization technique. Experimental results are presented to demonstrate the performance of the proposed flux and torque estimator and efficiency optimizer.