LFS is distributed entirely over the internet. It can be downloaded and installed for free, but unlocking all content and certain features requires purchasing a license. Without a license the game functions as a content-limited demo — no time restriction, but only one track and three cars are available.
The physics engine models tires, suspension, aerodynamics, drivetrain, several gearbox types, clutch overheating, and car body and engine damage. The tire model includes dynamic wear, dynamic dirt, flat spots, hot spots, and tire wall deformation.
Input support covers steering wheels, mice, keyboards, joysticks, and gamepads. Output supports 2D and 3D displays including virtual reality headsets; 3D device support (including the HTC Vive, Oculus Rift DK1 and DK2) has been present since version 0.6F/0.6G, and VR headset support was added in June 2014.
Races can run to a fixed lap count or a fixed duration, as in endurance racing. Pit stops support refueling and tire changes, with mid-race pit strategy adjustments. Pit lane speed limits of 80 km/h are enforced via drive-through, stop-and-go, or time penalties. Starting grids can be set randomly, by finishing order from a previous race, or from a qualifying session.
Training mode covers cornering, throttle and brake control, and negotiating opponents. Lessons are arranged per car from slow to fast and must be completed in order, though finishing them is not required to unlock cars.
The S2 release offers 20 vehicles spanning under 100 hp to over 700 hp. The roster includes fictional sports cars, GT DTM-style race cars, former JGTC-class cars, and road-legal hatchbacks. Five officially licensed real cars are included: the BMW Sauber F1.06, the Formula BMW FB02, McGill University's Formula SAE car (produced in conjunction with McGill Racing Team), the Valmet RaceAbout 2003 concept designed by Helsinki Polytechnic Stadia, and the Volkswagen Scirocco (not yet released as of the latest patch). From December 2021, starting with version 0.7A, LFS added vehicle mod support via the separately downloadable LFS Editor, with an automatic in-game mod download system and a web-based and in-game mod browser.
LFS has eight fictional track areas, including one loosely based on eastern central London, one based on Jamaican surroundings, and one near Kyoto, Japan. Each area has multiple configurations, all of which can also be driven in reverse. The simulator includes a laser-scanned version of Rockingham Motor Speedway as part of the S3 license, playable from version 0.6K released in December 2015. An in-game autocross editor allows users to create custom layouts; three car park environments are provided for this purpose.
The game is structured across three stages — S1, S2, and S3 — each adding cars, tracks, and raising the maximum server player count, with technical improvements shared across all stages. A commercial alpha of S2 was released on 24 June 2005. S3 launched on 19 December 2015. S3 license holders retain backward access to S2, S1, and demo servers.
LFS was used in the Intel Racing Tour in 2007, a competition held in Germany with a BMW Z4 (E85) as the main prize. This partnership led to the addition of the BMW Sauber F1.06 to the game.
In 2008, LFS was incorporated into the V1 Championship, a driver talent search broadcast on television in the United Kingdom. V1 Championship used LFS as part of a selection process alongside physical and psychological tests and real-car sessions. The cooperation yielded a license for the Formula BMW car in-game, and a contact through V1 Championship led to Rockingham Motor Speedway joining LFS as S3 content.
LFS was also used by Turtle Entertainment and Volkswagen to showcase the new Scirocco at the Leipzig Games Convention in 2008, where the prize for a competition was a real Scirocco. The Scirocco's scheduled in-game release of 19 December 2008 was delayed indefinitely following fatal flaws in a patch, requiring the team to rebuild the suspension system and tire physics.
LFS integrates with LFSWorld.net, a real-time statistics and database site with online skin support. Per-racer statistics cover lap times, lap counts, distances traveled, and fuel consumed. Users can view others' stats, download hotlaps, and upload custom car skins that auto-download in-game for other players. An official world record lap time chart exists per track and car combination.
The original LFS was nominated for PC Gamer US's 2003 "Best Racing Game" award, which was won by NASCAR Racing 2003 Season. PC Gamer described it as evidence that "accurate driving physics and fun, accessible racing action can co-exist in the same game." PC Gameworld's 2003 review by Walter Hurdle scored 89% and called it "A very strong simulation that offers fun and a high level of realism." Justin Kranzl of APC magazine called the S1 release "the best PC racing simulator ever." Pelit magazine's 2004 review by Mika Äärilä scored 92/100. A 2005 Bytesector.com review of S2 stated: "Nothing short of going to a track actually compares to the experience."
In 2005, AutoSimSport magazine awarded LFS "Best simulation." Blackhole Motorsports readers voted LFS "Game of the Year," "Best Multiplayer," "Best Physics," and "Surprise of the Year."
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