Ilmor Engineering was founded in November 1983 by Mario Illien and Paul Morgan, both formerly of Cosworth, where they had worked on the turbocharged DFX engine for CART racing. Differences of opinion over the future direction of that programme led them to leave and establish their own company. Cosworth later claimed there was considerable acrimony in the split, alleging the Ilmor design was little different from their own planned DFX modifications.
The new company was financed by team owner and chassis manufacturer Roger Penske, who had a clear commercial incentive for a competitive proprietary engine. Ilmor set up manufacturing in Brixworth, Northamptonshire, with a maintenance office in Plymouth, Michigan, to support American-based race teams.
The inaugural Ilmor engine, the 265-A, was badged initially as the Ilmor-Chevrolet Indy V-8 and debuted at the 1986 Indianapolis 500 with Team Penske driver Al Unser. The following year, 1987, the programme expanded significantly to encompass all three Penske team drivers — Rick Mears, Danny Sullivan, and Al Unser — as well as Patrick Racing and Newman/Haas Racing. Mario Andretti, driving for Newman/Haas, won the engine's first Indy car victory at Long Beach in 1987, and he also took pole position at the 1987 Indianapolis 500. Rick Mears earned the first 500-mile race win for the engine at the 1987 Pocono 500.
In 1988, now rebadged simply as the Chevrolet Indy V-8, Mears won the Indianapolis 500 — the engine's first victory at that event. That result opened a remarkable streak of dominance: the engine went on to win 64 of the next 78 CART races between 1987 and 1991, a record of dominance that transformed the competitive landscape of American open-wheel racing.
For the 1992 season, the 265-A was joined by the 265-B engine, which Penske Racing ran exclusively with drivers Rick Mears and Emerson Fittipaldi, winning four CART series races with the newer specification. All other Ilmor-supplied teams continued with the 265-A through 1992. Bobby Rahal, driving a 265-A, won the 1992 CART championship — the fifth consecutive (and final) drivers' title for the 265-A. Al Unser Jr. also won the 1992 Indianapolis 500 in a 265-A, the fifth consecutive and final Indy 500 win for that specification. Emerson Fittipaldi finished fourth in points driving the newer 265-B.
For 1993 the 265-C was introduced with the intention of replacing both the 265-A and 265-B across the entire programme. However, Chevrolet elected to withdraw its badging support after the 1993 season, ending the formal Chevrolet-Ilmor partnership.
The most dramatic engineering statement of the 265-series era came at the 1994 Indianapolis 500, when Ilmor produced a bespoke engine specifically for that event. The 500I was a V8 featuring pushrod-actuated valves — exploiting a historical loophole in the Indianapolis 500 rules that permitted engines derived from production blocks to run at increased capacity (3.43 litres versus the standard 2.65 litres) and substantially higher turbo boost than the pure racing engines.
Stock-block engines such as the Buick V6 had previously exploited similar rules, and the regulations had been relaxed intending to permit such units with stronger blocks. Ilmor produced a new engine specifically meeting these requirements, generating roughly 200 bhp more than the competing Cosworth XB and Ilmor 265-D opposition. Team Penske's cars were the fastest at Indianapolis that year, with Al Unser Jr. winning and Emerson Fittipaldi running strongly until an accident on lap 184. The loophole was closed for 1995.
For 1994 the naturally-aspiring 265-D was introduced without any manufacturer badging, and the engines were referred to simply as the Ilmor-C and Ilmor-D. From 1995, Mercedes-Benz became the new badging manufacturer for the engines, replacing Chevrolet. Al Unser Jr. finished runner-up with four wins in 1995, and Rahal-Hogan Racing joined Penske as major users of the programme.
Following the CART-IRL split that began in 1996, Ilmor primarily supplied CART-based teams. The one Indy 500 appearance of the Ilmor Mercedes-Benz D in 1996 — entered by Galles Racing — resulted in a second-place finish, the powerplant's sole start in an IRL-sanctioned race. When the IRL switched to normally aspirated engines for 1997, the turbocharged 265-series was permanently excluded from the Indianapolis 500 and ran exclusively in CART thereafter. Mercedes left CART after the 2000 season.
The Chevrolet Ilmor 2.65L V8 stands as one of the most successful engine programmes in American open-wheel history. Its 64-win run between 1987 and 1991 was unprecedented in the modern CART era, and the consecutive Indy 500 victories from 1988 through 1992 cemented its place as the dominant unit of its generation. The Ilmor-Chevrolet partnership also established Ilmor as a major independent engine builder capable of challenging and defeating established manufacturers, a reputation that carried forward into the company's subsequent Formula One work with Mercedes-Benz powering McLaren to championship success in 1998 and 1999.
Ilmor returned to IndyCar partnership with Chevrolet in 2012 on the new turbocharged V6 programme, continuing a relationship that had defined the sport's competitive character for much of the previous quarter century.