AbstractThe annual growth rate of CO2 emissions from China's transportation sector exceeded the growth rate of emissions from the whole society, making transportation the third‐largest CO2 emissions sector after the industrial and household consumption sectors in China. This paper is intended to project CO2 emissions in China's transportation sector from 2010 to 2020 and to assess the effectiveness of possible reduction measures. A detailed bottom‐up model has been developed and four scenarios have been designed to describe the future development of the sector. The results indicate that under the business as usual (BAU) scenario, emissions would increase by 58%, reaching 1.38 billion tCO2 by 2020. Reduction potentials ranged from 96 to 515 million tCO2 under different scenarios. Road transportation alone accounted for more than 80% of total emissions on average, making it a key target for CO2 mitigation actions. Application of conventional transportation technology, together with accelerating the development of new‐energy technologies, was the most effective and contributed to more than 70% of reductions. These measures combined with traffic mode shifts in consumption patterns will lead to the sustainable and effective development of China's transportation sector. In addition, to avoid a rebound in transport fuel demand, policies combination is suggested. © 2016 Society of Chemical Industry and John Wiley & Sons, Ltd.